2 Discussions and One Reflection Post

Ethics and Decision Making

Introduction: We have learned that a "good decision is never an accident" but this brings up a couple of other interesting issues such as – is an ethical decision never an accident or perhaps more intriguing is a good decision by necessity an ethical decision? The second question brings up numerous concerns many of which are debated in the newspapers on a daily basis thanks to the folks at Enron. Ethics and morality is rarely as obvious as the case at Enron, but on a higher level where does an individual’s ultimate responsibility lie? Some would say with family, others with country and yet others with religion just to name a few.

Trying to determine a common moral code is not easy task as the history of theology has taught us on countless occasions. Quantitative analysis is a key piece of effective decision-making but this is simply the execution and what numbers you choose to evaluate and how you choose to evaluate the results is highly subjective. The tools provide empirical information to utilize when making a decision but they do not provide the decision itself. This is true whether or not you are including ethics as part of the process or not.

Of particular interest to this paper is whether ethics and morality are a further step in the decision-making process or does it become an element of each step in the process. To determine this each of the stages in the decision-making process will be evaluated in the context of ethics and morality. Questions of interest are whether ethics and morality play a role in each stage and if so to what extent. The next section of the paper will provide some real world examples and finish up with the conclusions that can be drawn.

Concept of Ethics and Morality: What is this concept we are trying to understand? "Morality is a system of rules that modifies our behavior in social situations. It’s about the doing of good instead of harm, and it sets some standard of virtuous conduct." Evaluating the difference of doing well versus harm and to what extent is subjective but this does not preclude us from attempting to find common ground. Please note that for the purposes of this paper I will use the terms ethics and morality interchangeably from this point forward. Often one identifies five principles in common morality:

· Autonomy: This relates to the question of exploitation of others and impacting their freedoms. Almost every decision has impacts on multiple persons and taking these impacts into not only consideration but engraining them in the process is not easy but necessary.

· Non-malfeasance:Will we be creating harm towards others? In government almost every regulation benefits one group while hurting another. The same holds true in the majority of business decisions – action creates a situation that by its very nature benefits some while does not for others. Doe this create harm? I would argue that something that is not beneficial to you does not mean it creates harm. Every challenge is an opportunity.

· Beneficence: Can this create good? A generic statement but worth considering and in essence all one needs to ask is can we solve the identified problem in a way that creates the most good.

· Justice: Is the process fair itself and is the resulting implementation fair. Essentially both the means and the end must be considered. The world is not equal nor should it be as all people are not created equal and what a boring place it would be if we were. There is all the difference in the world between treating people equally and attempting to make them equal.

· Fidelity: Does this follow our professional, corporate or governance roles as defined. Often this involves looking at the bigger picture and understanding the spirit of your role beyond straightforward results.

As you will have no doubt noticed these definitions are far from concrete or straightforward principles to apply. Every person potentially will have different perspectives or degrees of agreement in each case. However, great strides will have been made if each person is evaluating their concept of ethics. One of the greatest dangers in this field is people ignoring the concept due to the ambiguity.

The Impact on Decision Making: There are six key stages identified in the decision making process which include in order:

1. Identification of the Problem: Although this is the first stage this may be where morality can have the greatest impact. This is often the most difficult stage for the researcher and if it is not completed properly the results will be unsatisfactory regardless of the quality (or morality) of the work that follows. The framework that is built here constrains or sets the scope of the project. From an ethical perspective the first question of importance may be – is this really a problem at all? More times than not the focus of problems relates to the reduction of costs or increase in revenue (or that may be my business bias). At this point the problem needs to be resolved by a choice of means, which many find unfavorable. Some proponents of ethical decision-making challenge decision makers to evaluate whether the perceived problem truly is a problem. It sounds simple but in reality the process of considering all the potential alternatives, including do nothing, is not common. Business leaders are engrained with the belief that flexibility, change and adaptation are the answers.

2. What is the Goal: The dilemma here is whether the goal is to solve the problem in an ethical manner or simply determine the most ethical goal. The conflict here is do you select a goal and then try to implement it in an effective matter later or do you choose your goals based on ethics. In a perfect world it would be optimal to choose a goal with ethics in mind, but in reality the maximized business goal is optimized by considering ethics in only a very general sense at this stage. Eliminate the few obvious options that are unlikely to have any ethical implementation and proceed forward.

3. Possible Actions: Pending your theory on determining the goal will have a huge influence on the types of actions that make sense. Actions are primarily determined by the goal you wish to achieve. Nevertheless ethics should influence the actions you are willing to take within the scope of your goal.

4. Predict Outcome: This may be the one stage in which ethics requires no change. Quantitative techniques are straightforward and merely calculate the results based on your inputs. The age-old computer theory of ‘garbage in – garbage’ out applies.

5. Pick the best alternative: Is the best alternative simply the predicted outcome which maximizes goals or does it merely provide empirical results for comparison (with which you can rid the outliers). Formulate the choice as a maxim for all similar cases is a concept those in favour of ethics will promote. This is a recurring theme which involves looking outside any particular situation and seeing the forest for the trees.

6. Implement Decision: In many cases this is an area where morality already plays a significant role in current business practice. Unions and significant regulations exist to ensure change is ‘ethical’. However, I would submit that real influence is found long before implementation. At this point you are just trying to minimize or trivialize perceived problems in the selected decision. Nonetheless for that reason it is important that decision makers consider the impacts of implementation. Hopefully if no satisfactory implementation can be found than the problem will be revisited rather than selecting the best of a group of bad choices, which is widespread..

An Application: Medical and Health-Care decision-making have been around since the time when Hippocrates developed his famous hippocritical oath for healers. This ancient philosopher wrote an oath that addressed the professional and ethical issues faced by physicians in their pursuit of healing individuals. The age-old problem has been how does a human being make such an important decision without any rhyme or reason?

Throughout time mistakes have led to the death of sick people. These mistakes have been made because of bad Medical and Health-Care decisions. The practice of making decisions related to the treatment of a condition or person in order to make them healthy is the primary focus of this literature (Web site) review. There has never been any formal body of knowledge that can assist a practitioner in choosing the appropriate course of action. Most of the major medical schools educate their students through a series of didactic methods and practical experience. The instructors have always taught using research and examples, yet there has not been a formalized mathematical approach to making Medical and Health-Care decisions due to the high subjectivity to these kinds of decisions.

Scientific research can eliminate definitively wrong decisions. However, with the fact that humans are the most complex entities in the world, decisions can not be a "one-size-fits-all".

Another Application: Lobby groups and labour unions are very interesting examples that potentially compromise ethics even though in many circumstances they have good intentions. By promoting the needs of a few over those of many can be considered unethical. This relates to David Ricardo’s comparative advantage of the nation. These groups also have a direct negative impact on people who are not a part of these groups. Yet it seems strange at first glance that promoting the interests of workers could in fact be immoral. The problems lies in the fact that the benefits do not extend to all workers despite the fact that decades ago these strides did in fact help all. However, now legislation exists to cover the most basic protections. One must also consider the fact that we will never know what market corrections may have remedied these issues on its own.

For a decision maker the impact of lobby groups and labour unions represent an area of misconduct on either side. Resources and funds that could be used in production are now allocated to tasks, which do not further a country’s growth. Some will argue that if business leaders had used ethical decision making then the need for unions would not have been required. You could also argue that getting involved in busting a union is making the ethical decision to improve the economy of the nation. What can be learned from this example? Other than the fact that ethics is not straightforward and that every situation is subjective this leads to the reality that Government has a role to ensure the few common standards are legislated. Beyond that the ultimate guide for a decision lies in the individuals hands.

The morally best course of action in any situation takes matters of economic and technical appropriateness into account, but is not overridden by these. Although this sounds noble I would take issue with the tendency to leans toward morality as the key decision influence. I feel that the economic and technical nature of a problem are the key determinants in decision making. Having said that I feel that ethics play a role in the majority of the stages of decision-making. Good process and analysis is not a barrier to morality. The key starts at the first stages of the decision process with problem identification and involves trying to ensure that one looks at the bigger picture and truly understanding what the goals are.

As stated earlier government plays a role to ensure basic protections are available to the entire population. For a business you have to expect people to be true to themselves. By our nature humans are self-interested and it’s a corporation’s responsibility to align the self-interest of its employees in the right direction. Corporate culture helps define this direction and can create an environment of ethical decisions.

Once the company culture is entrenched it is then necessary to hire the right people. Individuals make decisions and therefore employees will determine whether ethics are executed or become a problem. Once you have hired the right people it is necessary to have communication throughout the organization. Dialogue which includes the exploration of new meaning through discourse will facilitate ethical decisions. This gives the individual decision maker multiple inputs and a better grasp of the big picture. Finally organizations must be extremely careful to monitor potential situations of conflict of interest.

In this environment individuals will identify the problems, set goals and make decisions within the standard framework, which are both successful and ethical. The decision making process outlined earlier does not need to be modified but rather an organization needs to hire ethical people and provide them with an ethical environment. Effective decision-making and ethics are not mutually exclusive. In fact the utilization of an analytical decision making process will often flush out immoral decisions based on merit without any specific intent to do so.

Further Readings: Cory J., Business Ethics: The Ethical Revolution of Minority Shareholders, Springer, 2005. The aim is to analyze why and how companies do not act ethically towards their minority shareholders, not how many, not which, not to what degree and not where. Ferrell O., J. Fraedrich, and L. Ferrell, Business Ethics: Ethical Decision Making and Cases, Houghton Mifflin Company; 5th ed., 2001. Velasquez M., Business Ethics: Concepts and Cases, Prentice Hall; 5 ed., 2001.