52 Part One Environmental and Organizational Context
1. What is meant by and what are some examples of globalization?
2. What are some of the major reasons why diversity has become such an important dimen-sion of today’s organizations?
3. How can diversity be effectively managed? Offer suggestions at both the individual and organizational levels.
4. What is meant by ethics, and what types of factors influence ethical behavior?
5. What is meant by corporate social responsibility? How can and does it affect the
“bottom-line” of today’s organizations?
Ethical issues are very much at the forefront of organizational behavior in today’s envi-ronment. One controversial issue concerns monitoring employees. Technology has now made it easy and inexpensive for employers to closely monitor the behaviors of employ-ees. Visit the Web site http://www.legalethics.com for information on ethics and laws relevant to the current workplace. It may be helpful for you to test your knowledge and understanding of the ethical climate by going to httl://www.mhhe.com/business/
management/buildyourmanagementskills/ethics/exercise.html. Then, going from these, search to see if you can come up with other perspectives on employee moni-toring as an ethical issue.
1. Do you believe employers should be allowed to electronically monitor workers? Would you like to be monitored in this fashion?
2. Summarize the different perspectives that you found on the Internet. Be specific as to where you found this information.
3. Discuss other ethical issues that surfaced when looking at the suggested Web sites or others that you found.
Internet Exercise:
Ethical Issues
Chapter 2 Environmental Context: Globalization, Diversity, and Ethics 53
Organizational Behavior Case: I Want Out
When the Budder Mining Equipment company decided to set up a branch offıce in Peru, top management felt that there were two basic avenues the company could travel. One was to export its machinery and have an agent in that country be responsible for the selling. The other was to set up an on-site operation and be directly responsible for the sales effort. After giving the matter a great deal of thought, management decided to assign one of their own people to this overseas market. The per-son who was chosen, Frank Knight, had expressed an interest in the assignment, but had no experience in South America. He was selected because of his selling skills and was given a week to clear out his desk and be on location.
When Frank arrived, he was met at the airport by Pablo Gutierrez, the local who was hired to run the offıce and break Frank in. Pablo had rented an apart-ment and car for Frank and taken care of all the chores associated with getting him settled. Frank was very impressed. Thanks to Pablo, he could devote all his efforts to the business challenges that lay ahead.
After about six months, the vice president for mar-keting received a call from Frank. In a tired voice Frank indicated that even though sales were okay, he couldn’t take it anymore. He wanted to come home. If nothing could be worked out within the next three months, Frank
made it clear that he would resign. When his boss pressed him regarding the problems he was having, here is what Frank reported:
Doing business over here is a nightmare. Everyone comes to work late and leaves early. They also take a two-hour rest period during the afternoon. All the offıces close down during this afternoon break. So even if I wanted to conduct some business during this period, there would be no customers around anyway.
Also, no one works very hard, and they seem to assume no responsibility whatsoever. There seems to be no support for the work ethic among the people.
Even Pablo, who looked like he was going to turn out great, has proved to be as lazy as the rest of them.
Sales are 5 percent over forecasted but a good 30 per-cent lower than they could be if everyone here would just work a little harder. If I stay here any longer, I’m afraid I’ll start becoming like these people. I want out, while I still can.
1. In Frank’s view, how important is the work ethic?
How is this view causing him problems?
2. Why do the people not work as hard as Frank does?
What is the problem?
3. What mistake is Frank making that is undoubtedly causing him problems in managing the branch offıce?
As recently as the 1980s, managers in some of the most productive organizations in the country used to pride themselves on treating all their employees equally. This typically meant holding the line on rules and regulations so that everyone conformed to the same set of guide-lines. Moreover, when people were evaluated, they were typically assessed on the basis of their performance in the workplace. In recent years there has been a dramatic change in management’s thinking. Instead of treating everyone the same, some organizations are now trying to meet the specific needs of employees. What is done for one individual employee may not be done for another. Additionally, instead of evaluating all employ-ees on how well they work in the workplace, attention is being focused on how much “value added” people
contribute, regardless of how many hours they are phys-ically at the workplace. This new philosophy is also spilling over into the way alternative work arrangements are being handled.
An example is Aetna Life & Casualty, where workers are given the option of reducing their workweek or com-pressing the time into fewer days. Under this arrange-ment, a parent who wants to spend more time at home with the children can opt to cut working hours from 40 down to 30 per week or put in four 10-hour days and have a long weekend with the kids. In either case, these personal decisions do not negatively affect the employee’s opportunities for promotion. Why is the company so willing to accommodate the personal desires of the workers? One of the main reasons is that
Real Case: Not Treating Everyone the Same
54 Part One Environmental and Organizational Context
Organizational Behavior Case: Changing with the Times
Aetna was losing hundreds of talented people every year and felt that the cost to the company was too great.
Something had to be done to keep these people on the payroll. As a result, today approximately 2,000 of Aetna’s 44,000 employees work part-time, share a job, work at home, or are on a compressed workweek arrangement. The company estimates that it saves approximately $1 million annually by not having to train new workers. Moreover, the company reported that in one recent year 88 percent of those employees who took family leave returned to work. An added benefit of this program is the fact that Aetna’s reputation as a good place to work has been strengthened. The Families and Work Institute recently named Aetna one of the top four
“family-friendly” companies.
Duke Power & Light is another good example of how companies are changing their approach to managing employees. Realizing that child care is a growing need among many employees, because in most households both parents now work, the company joined forces with other employers to build a child care center. The firm has also changed its work schedule assignments. In the past, many employees reported that they hated working swing shifts: days one week, evenings the next, and then
nights. So the firm created 22 work schedules and now lets employees bid on them annually, based on seniority.
Some of these shifts are the traditional five-day week of eight-hour days. Others, however, are compressed work-week alternatives, including four 10-hour days and three 12-hour days. At the same time, the company has been turning more authority over to the personnel and has driven up its employee-to-manager ratio from 12 to 1 to 20 to 1. As a result, the company now has an attrition rate that is over three times lower than the industry aver-age, and most of this attrition is a result of people’s transferring to other jobs in the utility. As one manager put it, “We needed to recognize that people have lives.”
On the basis of results, it is obvious that the new arrangement is a win-win situation for both the workers and the firm.
1. How is the new management philosophy described in this case different from that of the old, traditional philosophy? Identify and describe the differences.
2. In what way are alternative work schedules proving helpful to managing diversity?
3. Do you think these new programs are likely to con-tinue or will they taper off? Why?
Jerry is director of marketing for a large toy company.
Presently, his team of executives consists entirely of white males. The company says it is committed to diver-sity and equal opportunity. In a private conversation with Robert, the company president, about the makeup of top-level management in the marketing department, Jerry admitted that he tends to promote people who are like him.
Jerry stated, “It just seems like when a promotion opportunity exists in our department, the perfect person for the job happens to be a white male. Am I supposed to actively seek women and minorities, even if I don’t feel that they are the best person for the job? After all, we aren’t violating the law, are we?”
Robert responded, “So far the performance in your department has been good, and as far as I know, we are not violating any discrimination laws. Your manage-ment team seems to work well together, and we don’t
want to do anything to upset that, especially consider-ing the big marketconsider-ing plans we have for this comconsider-ing fiscal year.”
The big marketing plans Robert is referring to have to do with capturing a sizable share of the overseas mar-ket. The company thinks that a large niche exists in var-ious countries around the world—and who better to fill that niche than an organization that has proved it can make top-quality toys at a competitive price? Now the marketing team has the task of determining which coun-tries to target, which existing toys will sell, and which new toys need to be developed.
1. Do Jerry and Robert understand what “management of diversity” means? How would you advise them?
2. Considering the marketing plans, how could they benefit from a more diverse management team? Be specific.
Chapter 2 Environmental Context: Globalization, Diversity, and Ethics 55
Real Case: The Ethics of Downsizing
Downsizing refers to a company’s decision to reduce its workforce for reasons other than poor perfor-mance, criminal conduct, or unethical behavior on the part of those being let go. The word is a euphemism meant to soften the blow as much for the company as it is for the soon-to-be eliminated. There is nothing wrong with making a diffıcult task easier to bear. In fact, there are good ethical reasons for doing so, as we’ll soon see. Still, there is no getting around the fact that downsizing is a type of layoff, with all that this implies. The ethical manager will keep in mind what is really going on when he or she is charged with let-ting good people go.