what would you do if you're in a store

paying for an item and the cashier gives

you back more money than you are

supposed to receive

would you walk away happy that you got a

better deal than you're supposed to or

would you correct the cashier and give

the money back

Ethical Dilemmas

hey guys travis stewart here and welcome

back to the business mindset

we are faced with ethical dilemmas

almost on a daily basis

and unfortunately some people don't

always follow the moral code of doing

what is right

they don't consider the cause and effect

of their actions putting their own

benefits before anyone else

going back to the example of the cashier

if you walked away with the extra cash

thinking well they should do their job

better or

it's fine the company factors in for

human errors what if that wasn't the

case

what if the cashier had to personally

pay back any differences when cashing

out at the end of the day

or worse what if they lost their job as

a result let's do another classic

example of an ethical dilemma

let's say that you controlled a switch

on a set of train tracks the train is

currently going to hit and kill

five people on that track if you switch

it it'll only kill one person

but here's the dilemma you are now

responsible for the death of that person

what do you choose not an easy choice is

it likely most of you would save the

five over the one but let me add another

factor to the trained dilemma

what if that one person on the other

track was someone that you knew if that

person was your mother your spouse or

your child

is your answer still the same each year

one in seven large corporations commit

some sort of fraud where they put their

personal gains before those who would be

impacted by the unethical action taken

we've seen this in the banking industry

with wells fargo where employees created

millions of savings accounts for people

without their permission

car companies like volkswagen lying

about their car's emission results

oil and gas companies such as enron that

had billions of dollars in debt from

their financial statements

as well as facebook who provided users

personal data to cambridge analytics

without their users consent so why is it

there are some companies putting the

cart before the horse when it comes to

ethical behavior

is it ego they don't want to show

weakness was it the pressure from

shareholders to meet or exceed quarterly

or annual results

despite the ever-growing regulations to

stop unethical decisions from being made

these type of unethical business

decisions are still happening today

of course the examples i gave are from a

general outside perspective of large

companies

but consider the impact of a lack of

ethics within all levels of an

organization

Employee Performance

not only at the executive level a lack

of ethics has a negative effect on

employee performance

there are cases when employees are so

concerned about getting ahead and making

money

they ignore protocols of their work

which can lead to errors that impact

various departments in the organization

because

the work has to be done again the right

way there are also times when employees

have the mindset that acting ethically

and following the rules will not get

them ahead

so they're demotivated which also leads

to a decrease in performance

Employee Tension

a lack of ethical behavior can also

cause tension among employees

if some employees are breaking the rules

to get ahead it creates a culture where

you can't trust

anyone out of the fear that they take

advantage of you to satisfy their own

desires

this is incredibly damaging to a

business since most businesses rely on

teams or departments

collaborating to make the company

successful worse yet

Lack of Ethics

if a manager shows a lack of ethical

behavior he'll likely lose the respect

from his staff

as i'm sure you know it's difficult to

run a successful business without

leaders who are well respected within

the organization

it's far too common when managers and

supervisors use their position and power

to mistreat and disrespect others

there's little protection against

abusive behavior in the workplace

unless the situation you're in involves

race gender or ethnic origin and even

this will vary depending on the country

you're working in

the quickest way to lose trust with your

Lies

employees is to lie to them but

employers do this all the time one out

of every five employees reported that

their manager or supervisor has lied to

them within the past year

i don't know the severity of the lies

from the statistics some consider white

lies as being acceptable in cases where

you're protecting someone's feelings

but in the end lies always reveal

themselves and at some point the

employee will still lose trust with you

for not being honest and straightforward

with them and if a lack of business

ethics becomes known by the public

the business will lose credibility and

trust which is very difficult to

overcome because

the brand will be associated with that

negative action for years into the

future

especially today when there's an

increased focus on corporate social

responsibility

and their impact on labor practices the

environment discrimination etc

some businesses are able to overcome a

negative public image however

it comes at a price the time and the

money spent on advertising campaigns to

rebuild the image in a positive way

most companies still lose a large amount

of their customers and in many cases

never win back the customers that they

lost

for example nike was faced with a

negative public backlash about child

labor in developing countries

starbucks was hit with a negative

headline for violating fair trade

agreements on coffee beans

this kind of media can have detrimental

consequences for a brand because

even if they rectify the problem the

brand has still been associated with

that unethical action which

remains in the minds of consumers

despite the several cases of unethical

business practices there's still hope

at the beginning of the video i

mentioned that there's one in seven

companies that commit some sort of

unethical business action

what about the other six companies what

keeps them on the path of ethical

business practices

according to economist alexander wagner

Protected Values

the driving force of ethical behavior of

individuals is what he calls protected

values

where these values are so deeply rooted

in the individual they can resist the

temptation to giving in to unethical

behavior

and do what's morally right the reason

for this is because

acting according to your protected

values holds more meaning intrinsically

if you find ways to earn money that's

consistent with your protected values

Experiment

rather than

finding shortcuts or taking some sort of

unethical actions to make a quick gain

mr wagner conducted an experiment where

individuals would flip a coin

four times in a private room

participants were instructed that they

would receive five dollars for every

coin flip that landed on tails

because the experiment was anonymous the

participants could provide any answers

they wanted

although the probability of flipping

tails four times in a row is very low

forty percent of participants reported

flipping tails four times which

is still higher than the probability

however what was interesting was the

other sixty percent of participants who

didn't report flipping tales four times

they could have

no one was watching them and there was

no penalty or disciplinary action for

falsely reporting

these individuals hold much stronger

regards for their ethical values than

the other 40

which is mr wagner's conclusion although

that one in seven companies commits some

sort of fraud there are six

companies that follow ethical business

practices because they're protected

values which is

a part of their organization's culture

Conclusion

when management is leading an

organization ethically

employees will follow accordingly

because they're holding those protected

values

employees make better decisions in less

time with business ethics as their

guiding principles

this results in an increase in

productivity and a much higher employee

morale and pride in the company they

work for when employees can work in a

way that is based on honesty and

integrity the whole company benefits

employees who work for a corporation

that demands high standards of business

ethics in all areas of operation

they're more likely to perform tasks at

a higher level and are more likely to

have loyalty to an organization

business ethics doesn't only improve

employee morale loyalty and culture

it directly impacts the company's

short-term and long-term profitability

a company's reputation in the public

also plays a major role when looking for

investors

if a company is perceived as operating

unethically investors are less likely to

purchase stocks because

the reputation will then be associated

with them as well i hope this video gave

you a lot to think about when it comes

to ethical

decisions in your organization and the

effects it has on your employees

customers and your reputation

if you like this video let me know by

hitting that like button and subscribe

if you haven't already

let me know your thoughts on business

ethics if you have examples positive or

negative

on ethics in your workplace let me know

in the comments section below

that's all for today see you in the next