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Management > Chapter 2: Integrity and Ethics: Foundations for Success in Small Business > Flashcards

Chapter 2: Integrity and Ethics: Foundations for Success in Small Business Flashcards

1
Q

What is Integrity?

A

A general sense of honesty and reliability that is expressed in a strong commitment to doing the right thing regardless of the circumstances

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2
Q

Acting with integrity requires that an individual first considers this

A

the welfare of others

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3
Q

A business owner should strive to live up to the highest standards of these in their business relationships

A

Honesty, fairness, and respect

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4
Q

Entrepreneurs must often make decisions regarding what is

A

Respectful and fair

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5
Q

Different groups must be considered while making decisions. These groups are

A 
Owners/Stockholders
Customers
Employees
Community 
Government
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6
Q

Individuals or groups who either can affect or are affected by the performance of the company

A

Stakeholders

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7
Q

The big three stakeholders are

A

Owners, Customers, and Employees

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8
Q

The big three is often referred to as

A

Primary Stakeholders

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9
Q

Some believe there is only one social responsibility of business, and that is to use its resources and engage in activities designed to increase these

A

Profits

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10
Q

Profits should be earned

A

honestly

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11
Q

Owners have a clear and legitimate right to benefit from the

A

financial profit of the company

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12
Q

These can sometimes be misleading without technically being illegal

A

Financial Reports

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13
Q

Who must the company please?

A

Customers

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14
Q

Owners who take customers seriously and care about them as individuals are

A

Apt to have more of them

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15
Q

Customer satisfaction with excellent products and service leads to

A

Healthy Sales

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16
Q

These issues are inherent in decisions and practices regarding hiring, promotions, salary increases, dismissals, layoffs, and work assignments

A

Fairness, honesty, and impartiality

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17
Q

What are employees concerned with that should not be ignored

A

Privacy, safety, and health issues

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18
Q

With employees, as well as everyone else, what should owners be?

A

Truthful and fair

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19
Q

What should owners show their employees?

A

Proper Appreciation

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20
Q

What kind of work employee should an owner create?

A

a positive one

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21
Q

Lapses in integrity can do this easily

A

Pass down from superiors to subordinates like a virus

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22
Q

What is a company’s ethical obligations to the community?

A

Social Responsibilities

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23
Q

Social responsibilities are often referred to as

A

the price of freedom to operate independently in a free economy

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24
Q

Although companies should not expect a reward from their social contributions, customers often do reward them through these

A

repeat sales, and a willingness to pay a little more for what they get

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25
Q

Social responsibilities can be seen as this

A

a luxury that the company simply cannot afford

26
Q

An owner must limit his social contributions to

A

what a company can afford

27
Q

A commitment to the community is not only good ethically, but it can be

A

good for business

28
Q

How does the government intervene directly into the economy?

A

By establishing laws to ensure healthy competition

29
Q

What are some examples of the government intervening in business matters?

A

Workplace Safety

Equal Employment

30
Q

What is it called when a company conceals some income?

A

Skimming

31
Q

Paying all forms of required taxes is a

A

Non-negotiable feature of integrity

32
Q

Misrepresentation of the facts to mislead others intentionally and earn their confidence is known as

A

The Legitimacy lie

33
Q

What does a legitimacy lie do to a company in the eyes of its customers

A

threatens the reputation and the trust that goes with it

34
Q

What are some concerns of prospective customers

A

Will the product serve my needs better than the alternative?
Do the company’s representatives know what they are talking about?
Will the organizations still be around to stand behind its product if I have a problem six months from now?

35
Q

A small firm’s legitimacy is staked on who?

A

The reputation of its owner

36
Q

How must a company be with customers about its practices and its privacy policy?

A

Honest and transparent

37
Q

Original intellectual creations, including inventions, literary creations, and works of art that are protected by patents and copyrights

A

Intellectual Property

38
Q

The belief that the ethical standards of one’s own country can be applied universally

A

Ethical Imperialism

39
Q

The belief that ethical standards are subject to local interpretation

A

Social Relativism

40
Q

Long term benefits of adapting ethical and responsible business practices include

A

Improved financial performance
Enhanced brand image and reputation
Increased sales and customer loyalty
Improved productivity and quality
Better recruitment and reduced employee turnover
Fewer regulatory inspections and less paperwork
Improved access to capital

41
Q

What is the greatest benefit of integrity in business?

A

The trust it generates

42
Q

Beliefs that provide a foundation for ethical behavior in a firm is known as a person or business’

A

Underlying values

43
Q

What does business behavior reflect?

A

The level of a person’s commitment to honesty, respect, truthfulness, etc

44
Q

The founder must express the importance of integrity by

A

leading with integrity

45
Q

What is key to a firm’s ethical performance?

A

The personal integrity of the founder and/or owner

46
Q

Integrity in a business requires this

A

A supportive organizational culture

47
Q

What are the five fundamental principles for a supportive organizational culture?

A 
Purpose
Pride
Patience
Persistence
Perspective
48
Q

Vision for the company including the founder’s core values are known as

A

Purpose

49
Q

This will lead to more ethical behavior in the business

A

Pride

50
Q

It is important to not push too hard for short term results

A

Patience

51
Q

Stand by your word; do not back down

A

Patience

52
Q

It is important to reflect on where your business is going, why it’s going there, and how you plan to get it there

A

Perspective

53
Q

The official standards of employee behavior formulated by a business owner is known as a

A

Code of Ethics

54
Q

The code of ethics shape and improve organizations by

A

Defining behavioral expectations
Communicating that those expectations apply to employees to all levels of the business
Helping employees convey the company’s standards of conduct to suppliers and customers
Serving as a tool for handling peer pressure
Providing a formal channel for communicating with superiors without fear of reprisal

55
Q

Other than expressing the principles that should be followed by employees, what should a code of ethics do?

A

Provides examples of these principles in action

56
Q

What does the Better Business Bureau do?

A

Shapes the conduct of businesses and promote ethical conduct

57
Q

The BBB promotes ethical behavior by

A

Providing consumers with information so they can make informed decisions
Creating an incentive for businesses to adhere to proper practices and addressing customer complaints
Resolving questions or disputes through mediation or arbitration

58
Q

The Ethical Decision Making Process is

A 
Define the problem
Identify alternative solutions to the problem
Evaluate the identified alternatives
Make the Decision
Implement the decision
Evaluate the decision
59
Q

A profitable company that responds to customers’ needs while showing reasonable concern for the environment

A

Sustainable small business

60
Q

The effort to protect and preserve the environment

A

Environmentalism

Management (20 decks)

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