Ethical Criteria and its Relationship with Business Negotiations - Essay Example

Ethical Criteria and its Relationship with Business Negotiations of Affiliation Ethical Criteria and its Relationship with Business Negotiation Introduction Marketers face difficulties in deciding on the marketing activities, and they affect all the stakeholders of their organization. Ethical theories are important for making concrete decisions by various organizational managers regarding their business activities and aids in business negotiations. Business negotiators tend to use different methods in making their ethical choices especially in the business world. Ethical behavior has the tendency to improve the working conditions at the place of work for employees and the other stakeholders. Through good ethics, the company improves its image to both the employees and the public. The main ethical criteria in businesses are utilitarian, universalism, categorical imperative, justice views, individualism, and social justice relativism and their relation to business negations. One of the ethical criteria is the Utilitarian criterion in which a business executive makes decisions solely based on the outcomes and consequences. Many businesses use the criterion to make decisions in the provision of the greatest good and for the greatest number. The criterion ensures that the decisions made create efficiency for the organization as it struggles to achieve its goals (Ferrell & Gresham, 1985). The method also aims at increasing the productivity of the business resulting in high profits of the company or the business enterprise. When a business executive maximizes profits, he can support his action that the decision he made as for the good of the organization. The use of Unitarianism leads to productivity and efficiency in an organization but can make the executive ignore the rights of some stakeholders especially the minority group making them feel unaccepted. The users of the criterion feel that they need to protect the organizations interest and the shareholders. Businesses require the stakeholders to hold negotiations especially when making important decisions. The criterion does not allow free negotiations and discussions by the company’s stakeholders as a single individual makes the decision for the benefit of the company. The choice of the action to be taken is determined by the largest number of stakeholders supporting it. The categorical Imperative involves the universal practice such that everyone is allowed to practice the proposed action. Kant developed the criterion and individuals wishing to use the criterion or the test should know that they would need to adopt the morality of the action. The morality of the action is the key to the adoption of the test, and the consequences of the action come last (Beekun, Stedham & Yamamura, 2003). In this, actions based on an individual interest have no moral support whether they benefit the society or not. The criterion allows stakeholders to hold free negations on business issues such as code of ethics, salaries, and anything that affect the management of the organization. The decision is accepted when everyone is comfortable with it and does not matter whether it yields good or bad results to the company. Adoption of such criterion may lead to business failure if the decisions made are not beneficial to the growth of the business. For instance, the universal response to an action related to the business may lead to its failure. The other criterion is the justice views, which is a test of the legality of the action taken by the management of an organization. The question raised here is whether the action is ethical or unethical according to the public views. Henderson developed the criterion through a framework that classifies an action according its legality or ethicality by exposing the decisions to the public for codification and scrutiny (Konovsky, 2000). In some circumstances, the actions may qualify to be ethical and legal and other times they may be unethical or illegal. The two categories are the most common and easy to evaluate for example payment of bribes is illegal and unethical. Other actions may be unethical but legal in some corporations and countries and are difficult to evaluate. An example is dressing in which some corporations may prohibit some dressing styles such as wearing short skirts although it is not illegal. The criterion allows negotiations that are legally and ethically acceptable to the society, organization, or country. Negotiations are limited to their legal and ethical values and no one can influence their implementation if they do not meet the acceptable code. The criterion assists the business to set its rules and regulations concerning their employees and their code of conduct at work and elsewhere. The other criterion is the universalism in which the action or the set rule applies equally to every stakeholder in an organization. The theory was developed by the early religious Universalists such as Winstanley Gerrard and the others who believed that all humans will face the universal judgments by God (Light, 2010). In many businesses, use of agreements in contracts is one example of universalism at work. The main disadvantage of the criterion is that in businesses the stakeholders have conflicting interests. Some Universalists normally use the courts in settling their disputes and protect the truth concerning issues in an organization. In many universality businesses, lawyers play a big role especially in cases involving contracts relating to high money value. In universalism, rules of the organization are more important than any relationship and individuals strive to climb the ladder without caring about their colleagues. In this criterion, business negotiations are limited to the universal written practices of the organization. Any business negotiations and views can only be implemented if they are in agreement with the organization’s set rule and its culture. No special preference is given to any party or decision as everything must be according to the company’s practice or tradition. Individualism criterion developed by Gilbert Simondon offers consideration for personal benefits in the decisions made by organizational managers. Companies that advocate for individualism encourage their employees to outperform their coworkers to secure some personal benefit (Meara, Schmidt & Day, 1996). The management rewards performing employees highly and in the long-run the company grows. An example is the case where teachers get an extra reward in the form of cash and certificates for producing high grades in some countries. Individualism encourages innovation as the employees compete to acquire new and better means for securing personal benefits as asserted by Fritzsche (1991). In individualism, a negotiation for certain decisions is acceptable if it is beneficial to the growth off the organization. Stakeholders can negotiate their deals with the managers and employers and reach a final decision without considering the reaction of the other parties. Other examples of individualism at work are the bonus earned by car dealers for having the highest sales. The main drawbacks to the criterion are that some individuals may only have short-term interest especially for big companies leading to their downfall. In the social group relativism criterion, the moral value of an action is determined by following the norms of ones peer group and argues that whatever that the group accepts is right. The theory first developed by Mahavira advocates the adoption of the existing norms of a particular group (Getz, 1990). For instance, some may cheat because everyone cheats. The group in the social group relativism theory may refer to a department, organization, or just a social group (Meara, Schmidt & Day, 1996). Employees of a particular organization will do as the other members are doing. The moral values are those determined by the group and not individual choices. The negotiations follow the rules initially set by the group, for example, a criminal lawyer will defend a client knowing that he/she is guilty as his job dictates so. The theory follows the group’s code of conduct and not personal moral standards. The criteria may lead to psychological conflict as one follows the groups rules and not the moral standards as asserted by (McDonal 2010). In this case, there is over-reliance on the accepted practice leaving no room for setting new norms and may lead to unethical behavior. The criterion does not allow free negotiations since the norms of the social group must be put into consideration. Everyone must adhere to the group’s regulations on several issues. For instance, in a department or organization, every member should have a two-week leave every year, it is difficult for any stakeholder to negotiate for a one-month leave as it is against the group’s norms. The main advantage of the criterion is that cultural and personal conflict can be avoided if everybody follows the set rules and regulations in an organization. Conclusion In conclusion, business organizations experience the dilemma of satisfying the interests of every stakeholder and maintaining their personal ethics and those of their organization during business negotiations. Business negotiations should be pegged on utilitarian, universalism, categorical imperative, justice views, individualism, and social justice relativism. In other terms, business negotiations should seek to realize the best interest of the business but not at the cost of the other stakeholders. Indeed, some of the most successful business empires have attained such status by applying sound business ethics in negotiations. In equal measure, large businesses have perished due to lack of ethics during business negotiations. References Beekun, R. I., Stedham, Y., & Yamamura, J. H. (2003). Business ethics in Brazil and the US: A comparative investigation. Journal of Business Ethics, 42(3), 267-279. Ferrell, O., & Gresham, L. G. (1985). 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