week 6

Aldo061991

Chapter11.EthicalLeadership.pptx

Home >Business & Finance homework help >Management homework help >week 6

Part Four Implementing Business Ethics in a Global Economy

Chapter 11 Ethical Leadership

Learning Objectives (1 of 2)

Define ethical leadership

Examine requirements for ethical leadership

Realize the benefits that come from effective ethical leadership

Understand how ethical leadership impacts organizational culture

Learn about the different styles of conflict management

‹#›

Learning Objectives (2 of 2)

Understand how employees can be empowered to take on responsibilities in ethical leadership

Examine leader–follower relationships

Learn about leadership styles and how they influence ethical leadership

Use the RADAR model to determine how ethical leaders handle misconduct situations

‹#›

Ethical Leadership

Leadership: Ability/authority to guide/direct others toward a goal. Ethical decisions are one dimension of leadership.

Can create an ethical culture.

Power to motivate/enforce norms, policies, and viewpoints.

Influence corporate culture and ethical posture.

Not simply allowing employees to follow their own moral codes.

Assume responsibility to model ethical conduct for employees.

‹#›

TABLE 11-2: Seven Habits of Strong Ethical Leaders

1. Ethical leaders have strong personal character.

2. Ethical leaders have a passion to do right.

3. Ethical leaders are proactive.

4. Ethical leaders consider all stakeholders’ interests.

5. Ethical leaders are role models for the organization’s values.

6. Ethical leaders are transparent and actively involved in decision making.

7. Ethical leaders take a holistic view of the firm’s ethical culture.

‹#›

Normative Myopia

Normative myopia: Occurs when leaders overlook/stifle important core values in decisions.

Believe normative values do not apply to managerial decisions.

Facts/values can be separated in decision making.

Normative values are outside the realm of business.

Result: Ethical blindness/propensity to rationalize an unethical action/turn a blind eye.

‹#›

Benefits of Ethical Leadership

Direct positive impact on corporate culture.

Can lead to higher employee satisfaction and employee commitment.

Can create strong relationships with external stakeholders.

Strong impact on long-term market firm valuation (positive association between ethical commitment of employees and a firm’s valuation on the stock market).

More likely to see government fines reduced if misconduct occurs.

Can create significant competitive advantages/value for company.

‹#›

Ethical Leadership and Organizational Culture (1 of 2)

Integrity-Based Approach

Leaders take responsibility for the firm’s ethical culture and hold employees accountable.

Usually have chief officers, human resource managers, and board member committees involved with ethics and compliance.

Approach empowers employees.

Can help the firm understand where questionable practices are occurring and where possible new ethical issues are arising.

‹#›

Ethical Leadership and Organizational Culture (2 of 2)

Remember:

Business is not static; it is dynamic.

Ethical leaders use an integrity/compliance combination.

‹#›

Leader Types (1 of 5)

Unethical leader

Usually egocentric.

Searches for legal loopholes.

Perceive ethics codes, compliance regulations, and industry standards as optional.

Justification for breaking laws: Serves a greater good; risk of getting caught is low.

‹#›

Leader Types (2 of 5)

Apathetic leader

Cares little for ethics.

Views ethics as relative/optional in a business context.

Often display no passion for firm/mission of the organization.

Employees don’t see sacrifices in them that other managers or leaders display.

‹#›

Leader Types (3 of 5)

Ethical leader

Includes ethics at every operational level.

Addresses issues as soon as they appear.

Tries to create participative organizational cultures.

Views employee collaboration as an important resource.

‹#›

Leader Types (4 of 5)

Psychopathic leader/corporate psychopath: Research suggests 1% could qualify.

Superficial charm.

No conscience.

Grandiose self-worth.

Little/no empathy.

Enjoy flouting rules.

‹#›

Leader Types (5 of 5)

Psychopathic leader/corporate psychopath

Companies with this leader have:

Heightened level of conflict.

Lower employee commitment.

Higher organizational constraints.

Heavier workloads.

Poor levels of training.

Lower job satisfaction.

Increased employee absenteeism.

‹#›

Conflict Management Styles

‹#›

Ethical Leadership Communication (1 of 2)

‹#›

Ethical Leadership Communication (2 of 2)

Transparency: Develops a culture where ethics is frequently discussed.

Reporting: Two-way process—both employee and leader feel a responsibility to report to one’s subordinates.

‹#›

Table 11-4: How to Avoid Groupthink

Source: Adapted from Lisa Quast, “Groupthink: 7 Tips to Prevent Disastrous Decision,” Forbes, April 18, 2016, https://www.forbes.com/sites/ lisaquast/2016/04/18/groupthink-7-steps-to-prevent-disastrous-decisions/#12f0446a5544 (accessed April 27, 2017).

1. Understand groupthink and how it can occur.

2. Allow open and honest discussions that encourage critiques, questioning, and criticism.

3. Criticism should be welcomed and not minimized or dismissed.

4. Create group tension by assigning a “devil’s advocate” or having half the team on the “pro” side and half on the “con” side to adequately evaluate decisions.

5. On important matters, bring in the appropriate subject matter experts (internally or externally).

6. Document the situation, options, recommendations, and implementation time table, needed support, and budget.

7. Have another team review your output.

‹#›

Leader-Follower Relationships

Leader-follower congruence: Leaders and followers share same vision, ethical expectations, and objectives for the company.

Leader-exchange theory: Leaders form unique relationships with followers through social interactions.

Power differences

Workplace politics

Feedback: Positive/negative via formal/informal methods.

‹#›

Leadership Styles (1 of 2)

Transactional leaders: Attempt to create employee satisfaction through negotiating, or “bartering,” for desired behaviors or levels of performance.

Transformational leaders: Strive to raise employees’ level of commitment and foster trust and motivation.

*Both can positively influence the corporate culture.

‹#›

Leadership Styles (2 of 2)

Authentic leaders: Passionate about company, live out corporate values daily, form long-term relationships with employees and other stakeholders.

‹#›

The RADAR Model

‹#›