The Challenges and Benefits of Acting with Integrity 2-3 Flashcards
Because of their size and their desire to succeed.
Small Companies are Often Vulnerable
Small, privately held firms that are not part of the corporate world epitomized by Wall Street may face greater pressures to act ______ than do large businesses.
Unethically
Do not have the deep pockets and superior resources than large businesses so it may be easier to rationalize unethical actions.
Small Businesses
Misrepresenting the facts or creating false impressions to mislead others intentionally and earn their confidence.
Legitimacy Lies
This happens because startups do not have a history and reputation to lean on when trying to sell customers on their new product or service or to impress important stakeholders.
Legitimacy Lies: Reason
- Threatens the reputation of the business
- Creates trust issues
- Future sales or support could be compromised if the lies are revealed.
Characteristics of Legitimacy Lies
Customers are least likely to decide to purchase if they have significant questions about the product or service about the product or service that the new venture is offering, about those who represent and/or run the business, and about the organization itself. These Features are known as:
PRO Factors (Products, Representatives, and the Organization)
Will the _____ (or _____) serve my needs better than the alternatives and will it be a hassle to change from the brand I currently buy?
- Most important factor when customers make purchase decisions.
Product (or Service)
Do the company’s _____ know what they are talking about, and will they (can they) live up to their assurances?
Representatives
Will the _____ still be around behind its product or service if I have a problem with it six months from now?
Organization
- Advertising (can be expensive)
- Well-crafted publicity program
- Social media tools
- Other promotional stragegies
- Highlight and honestly bolster the credibility of anyone who represents the venture.
- Make credentials of key employees known
- Encourage key employees to build important relationships and organizations.
- High quality web-site
- Strategic alliances
Addressing PRO Factors
An issue of great concern for Internet buyers.
Privacy
Digital ID tags that connect data on customer’s buying habit related to a particular Internet address. Businesses can use this to create a detailed profile of the customers, while it may then sell to media buying companies and other interested groups.
- Allows a business to create a more personalized shopping experience.
- Opens the door to potential misuse of data
Cookies
Be honest and transparent with customers about its practices and draft a privacy policy that conforms to the guidelines provided by organizations like the Better Business Bereau or through consultation with an attorney.
To Minimize Customer Concerns about Privacy
Another issue of privacy concern between employees and their employers out of concern for “cyber slacking”
Reading Personal E-Mails
Original intellectual creations, including inventions, literary creations, and works of art, that are protected by patents, copyrights, trademarks, design rights, and trade secrets.
Intellectual Property
Intellectual property allows originators of such to require _______ for its use.
Compensation
Has made it easy for millions of users to copy intellectual property free of charge.
The Internet
Ethical questions that can arise deal with:
- Consulting services to a foreign government if it refuses to support basic human rights or repress its citizens politically
- The use of toxic chemicals that are legal in other countries
- Bribes
Doing Business Abroad
Frequently, when dealing with companies abroad, the U.S. will simply apply U.S. _____ to the situation.
- Problem that arises: ethical imperialism
Standards
The belief that the ethical standards of one’s own country can be applied universally.
Ethical Imperialism
Makes it illegal for U.S. businesses to use bribery in their dealings anywhere in the world.
Foreign Corrupt Practices Act
The belief that eithical standards are subject to local interpretation.
Ethical Realism
Troublesome because it implies that anything goes if the local culture accepts it.
Ethical Realism
- Consider the nuances if its particular international environments
- Training- for employees to understand the firm’s commitment to integrity
- Consulting an attorney with expertise
- One-time practices may set a pattern for future behavior (so avoid bad ones)
Dealing with Inegrity and International Business
Aware of the importance of the bottom line, but this is not their singular focus. Nontheless, extraordinary financial performance often follows their efforts.
Those who have Integrity
- Improved financial performance
- Enchanced 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
Benefits of Eithical and Responsible Business Practices (BSR)
The greatest benefit of integrity in business. Results only when there’s a match betweenthe stated values of a company and its behavior in the marketplace.
Trust
