ON TIME BUSINESS MANAGEMENT A+ WORK, ON TIME, NO PLAGARIZING; ON TIME

Too much of a good thing? The impact of ethical controls and perceived controllability on

salesforce job performance Joon-Hee Oh

Marketing and Entrepreneurship, California State University, East Bay, Hayward, California, USA, and

Wesley J. Johnston and Carolyn Folkman Curasi Department of Marketing, Georgia State University, Atlanta, Georgia, USA

Abstract Purpose – The purpose of this paper is to attempt to better understand the relationship between organizational ethical climate, the internalization of ethical codes (INT), perceived control and business-to-business (B2B) and retail salesperson job performance. This research develops and tests a model that examines these relationships to better understand the relationship of these variables to salesperson job performance. Design/methodology/approach – Using the theory of planned behavior (Ajzen, 2002) as the theoretical lens and survey data from 307 salespeople in the USA, this study examines the relationship between organizational ethical climate, salesperson perceived control and salesperson job performance. This study examines whether this relationship may change with the presence of intervening variables related to a strengthened organizational ethical climate, and examines the relationship between these variables in two different analyses. First, this study examines the differences among retail salespeople as compared to B2B salespeople. Then this study examines the total dataset of salespeople as one sample. Findings – The findings show that the positive effect of organizational ethical climate on the job performance of salespeople was reduced significantly when salespersons’ INT and salesperson perceived controllability, were examined in this relationship. Practical implications – Organizational controls, such as an ethical climate within a firm, can impact salesperson job performance, especially if the firm’s ethical climate causes the salesteam to feel that it lessens their perceived control. This study found that if the ethical climate reduces the salespeople’s feelings of self-efficacy, that the ethical climate changes can intervene and can significantly reduce the otherwise positive effect of the organizational ethical climate on salesperson job performance. Originality/value – From a theoretical perspective, the research is distinctive in its endeavor to better understand the relationship between the role of salespersons’ ethical code internalization and their feelings of self-efficacy and perceived control. This paper then examines how these variables can be influential to the direct effect of organizational ethical control and can impact the job performance of salespeople. The findings contribute to research by advancing our knowledge of how we can enhance the responses of salespeople to an organization’s ethical control, leading to higher customer satisfaction and improved sales performance.

Keywords Job performance, Theory of planned behavior, Ethical climate, Internalization, Perceived control, Salesperson management, Internalization of ethical code

Paper type Research paper

Introduction

Addressing the growing concern about ethical business misconduct over the past two decades has led researchers to heighten research attention on the relationship between a corporate code of ethics and sales force behavior. Researchers have found a strong relationship between a well-communicated code of ethics and ethical salesforce behavior (Itani et al., 2019; Kaptein, 2015; Weeks and Nantel, 1992). Extant research documents that employees working in a corporate environment with a strong ethical culture often deliver relatively strong job performance, while at the same time reporting high measures of

job satisfaction. More studies have empirically confirmed that an ethical climate (Schwepker and Ingram, 2016; Schwepker and Schultz, 2015), an ethical environment (Hijal-Moghrabi et al., 2017) and ethical codes (Kaptein, 2015; Valentine and Barnett, 2002), can all have a positive effect on sales employee performance. Such documented relationships have motivated firms to focus on the ethical environment to improve sales performance. As a result, firms continue to strengthen their ethical controls.

The current issue and full text archive of this journal is available onEmerald Insight at: https://www.emerald.com/insight/0885-8624.htm

Journal of Business & Industrial Marketing 37/6 (2022) 1241–1254 © Emerald Publishing Limited [ISSN 0885-8624] [DOI 10.1108/JBIM-01-2021-0021]

This research on Sales Ethics has been made possible, in part, by financial support from: The Center for Business and Industrial Marketing (CBIM), J. Mack Robinson College of Business, Georgia State University, Atlanta, Georgia, USA and Department of Marketing, College of Business & Economics, California State Universtiy, East Bay Hayward, California, USA.

Received 12 January 2021 Revised 1 June 2021 12 August 2021 Accepted 13 August 2021

1241

No employee is immune to ethical challenges, and some employees are inherently more “at-risk” of facing ethical issues, based upon the kind of work they do. In this research, we investigate this relationship among salespeople because salespeople are among those employees who tend to experience more ethical dilemmas in their work (Itani et al., 2019; Schwepker and Ingram, 1996; Dukerich et al., 1990) and may be socialized more strongly within their own sales team subculture than within that of their larger corporation (Merkle et al., 2020). In addition, business-to-business (B2B) salespeople are boundary spanners, often working in a location physically removed from their corporate headquarters. This can weaken their attachment to the overall corporate culture and to the larger social network within their employing corporation (Bush et al., 2017; Ferrell et al., 2019). The issues and dilemmas faced by B2B salespeople are far more diverse than those of other employees and entail far more knowledge and experience to be able to proceed ethically, than simply being an honest and principled individual (Ferrell et al., 2019). Thus, unlike the prevalent belief of its positive influence on all types of business performance, a strong ethical culture may not be completely beneficial in all situations, or, there may be boundaries to when a heightened ethical climate is beneficial for an organization. The purpose of this paper is to attempt to better understand

the relationship between organizational ethical climate, the internalization of ethical codes (INT), perceived control and B2B salesperson and retail salesperson job performance. We examine salespeople as two groups, retail salespeople and B2B salespeople, and then also examine both groups of salespeople together, as one sample, to investigate whether there are differences between these two groups, based on the different roles these two sales positions entail. Using the theory of planned behavior (Ajzen, 2002) as our theoretical lens and survey data from 307 salespeople in the USA this paper develops and tests a model that examines these relationships to better understand the interplay of these variables in relation to salesperson job performance. Specifically, we examine whether this relationship may change with the presence of such intervening variables as the INT and perceived controllability. Our research makes several contributions to the sales ethics

and sales management literature stream. First, our study responds to recent calls for additional research attention on sales ethics to assist marketing practitioners and academics alike to better understand the sales profession and how different variables in the sales organization may impact the job performance of the sales team (Bush et al., 2017). Second, this research examines the ethical environment of sales organizations to attempt to better understand the interplay and impact of the internalization of a code of ethics and a strong ethical organizational climate, on a salesperson’s perceived behavioral control and the resulting job performance of salespersons. Third, in doing so, we examine the climate of an organization and how that climate can effect a salesperson’s perceived control and feelings of self-efficacy, using Ajzen’s theory of planned behavior, consistent with a call for more research focusing on the impact of attitudes on salesforce behavior (McClaren, 2015). Fourth, our research makes a contribution to the sales ethics literature stream by comparing salespeople as two separate groups, those who work in a retail

setting, and those who work in a B2B environment. We compare both groups of salespeople, individually and then together as one data set of salespeople, to better understand the differences between the two salesforce positions, as they relate to an ethical corporate environment, the internalization of the corporate code of ethics, their feelings of perceived control and their resulting job performance. Fifth, we contribute to better understanding the changes in organizational buying behavior contributing to closing the gap between B2B practitioners’ challenges and scientific research, found to be located within one of the six major areas of inquiry, as outlined by Mora Cortez and Johnston (2017). Then, this research examines sales ethics within sales organizations to determine whether there may be boundaries related to sales ethics and salesperson performance that sales management and marketing academics could benefit from, if we had a better theoretical understanding of those relationships. Finally, based on our findings, we include managerial implications for sales organizations to both increase the ethics of their salespeople, while also ensuring that salesperson perceived control and sales performance are not reduced. We begin this paper by presenting the conceptual

background that frames our model and our hypotheses. Next, we discuss our research method and describe our sample. Then, we examine the relationship between these variables in two different analyses. First, we examine the differences among retail salespeople as compared to B2B salespeople. Then we examine the total dataset of salespeople as one sample. Next, we interpret our findings in light of current theory and discuss implications for sales organizations. Finally, we suggest avenues for future research.

Theoretical foundation and hypothesis development

Organizational climate regarding ethics Organizations need to establish standards through which they can uphold performance measures within their operations. Establishing standards involves developing controls and methods for measuring performance, for determining whether performance matches company standards and policies for taking corrective action, if necessary (Oliver and Anderson, 1994). An organizational control system, thus, is a set of procedures for monitoring, directing, evaluating and compensating employees. Various studies have discussed organizational control, and its direct or indirect influence on individuals (Oliver and Anderson, 1994; Piercy et al., 2006; Kaptein, 2015). Generalized into sales organizations, the implication for

salesforce management is significant and suggests that salespeople face a form of reward or punishment in their daily practices and subsequently relate their expectations of reward or punishment to their job outcomes (Johnston and Kim, 1994). Hence, it is an effective strategy to operationalize organizational controls for job performance in sales (Friend et al., 2014), thereby promoting sales organizations to encourage more effective practices and behaviors with their salespeople. Sales management, in addition, often enforce ethical controls

because research suggests that a strengthened ethical

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1242

environment will also improve salesforce performance. Extant research suggests that a salesforce used in an ethical environment will result in higher job performance and higher job satisfaction (Weeks and Nantel, 1992). Research has empirically confirmed that an ethical environment (Jaramillo et al., 2006; Schwepker and Schultz, 2015) and ethical codes of conduct (Valentine and Barnett, 2002; Kaptein, 2015), can have a positive effect on employee performance. Such proven relationships have supported the strategic position that organizations, which strengthen their ethical controls also tend to strengthen their sales teams’ sales performance. Organizational climate refers to the ways that organizations

operationalize routine behaviors, and to the actions that are expected, supported and rewarded (Ferrell et al., 2019). Organizational climate thus refers to perceptions of organizational practices and procedures shared among employees (Schneider et al., 2013), which indicate the institutionalized normative systems that guide behavior (Matthyssens and Johnston, 2006). Organizational climates vary in type and address different facets of the environment, such as safety, customer service and ethics. Organizational climate pertaining specifically to ethical issues consists of the prevailing perceptions of typical organizational practices and procedures that have ethical content (Merkle et al., 2020). Dickson et al. (2001) refer to the type of climate as climate regarding ethics (CRE), noting that the more traditional term ethical climate can be misleading because some may suggest that an organization’s climate is “ethical” within the context of the values of the larger society. While societal values are likely to influence organizational practices, both organizational climate and organizational ethics are, by nature, defined within the context of a particular setting (Merkle et al., 2020). As such, this aspect of organizational climate provides norms and expectations of behavior viewed as ethically acceptable and helps members determine what issues have ethical content, as well as the criteria to determine appropriate actions within a particular organization (Cullen et al., 2003). CRE is, thus, the ethical climate of an organization. CRE, as the shared perception of what behavior is ethically

correct, and how ethical issues within an organization should be handled (Dickson et al., 2001; Erben and Günes�er, 2008) can help individuals within an organization answer the question, “what should I do?” (Treviño et al., 2001, p. 301; Victor and Cullen, 1988, p. 101). CRE within an organization will likely affect how individuals choose to deal with ethical issues (Friend et al., 2020; Itani et al., 2019; Kaptein, 2015). CRE also has an impact on organizational outcomes, including those that do not have specific ethical components (Dickson et al., 2001). Moreover, CRE forms the ethical character of an organization by providing environmental cues that guide ethical behavior (Victor and Cullen, 1988). In a sales context, it relates to the salespeople’s perceptions about their organization’s current practices, procedures, norms and values with an ethical content that provides cues or guidelines about acceptable behaviors (Babin et al., 2000; Boles et al., 1999). These guidelines may reduce the sales team’s temptation to disregard ethical courses of action to make a sale. A strong CRE should reduce role stress, role ambiguity, role conflict and increase job satisfaction and indirectly increase commitment to service quality. In turn,

these should all help to increase productivity (Babin et al., 2000). In this regard, we consider CRE as a form of organizational

control that is subject to management control. Although CRE is a manifestation of organizational culture, corporate sales ethics training programs can provide guidance, direction and control, and have been found to foster an ethical climate and promote salesperson behaviors that are more consistent with that company’s orientation toward their customers (Bush et al., 2017; Weaver et al., 1999). Thus, CRE provides norms and expectations of behavior communicating what is ethically acceptable and, thus, ideally, helps members determine what issues have an ethical content, as well as criteria to determine appropriate actions within an organization (Ritter et al., 2002). An effective and efficient salesforce-management strategy should operationalize such organizational controls as CRE to increase sales performance from their salespeople, thus suggesting:

H1. There is a positive relationship between CRE and salesperson job performance.

Internalization of ethical codes Researchers have examined the effects of outcome-and behavioral-based systems on salespeople (Oliver and Anderson, 1994, 1995). Oliver and Anderson (1994) argue that despite the polar opposite nature of the control systems, behavioral- based and outcome-based control systems have a confluent effect via employees’ perception of the control system, on salespeople’s job-related cognitions, affects and behaviors. Research on the control aspect of organizational influence on salespeople found that inconsistencies among the elements of the salesforce control-system hurt salesperson performance (Onyemah and Anderson, 2009). These findings suggest that salesforce job-related cognitions, affects and behaviors influence salespeople as they interpret, and assimilate organizational controls, such as CRE. That is, salespeople’s internalization occurs in response to firms’ enforcement of CRE. Internalization refers to an experiential learning process by

which an employee’s behavior changes when they take on norms or rules as “their own” (Grundstein-Amado, 2001). Code internalization is a form of social control – an informal, employee-based control system built on the adoption and “internalization of values and mutual commitment toward some common goal” (Jaworski, 1988, p. 27). Thus, the INT is an outcome of other controls in use (i.e. enforcement of ethical codes and discussion of ethics), as well as the socialization process (e.g. training andmentoring) used by the firm. Internalization of the firm’s norms, values and codes is the

stated goal of virtually all socialization programs (Allen and Meyer, 1990; Jones, 1986). Enforcement of ethical codes has a positive impact on code internalization (Schwepker and Hartline, 2005). In situations in which there is a robust organizational CRE, assimilation and adoption of the organization’s ethical prescriptions and proscriptions are highly likely (Dickson et al., 2001). Ethics codes contribute to ethical behavior by influencing the perceptions employees have of the organizations’ ethical values (Kaptein, 2015; Valentine and

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1243

Barnett, 2002). Therefore, firms will take steps to enforce ethical codes that have a positive impact on code internalization (Schwepker and Hartline, 2005). As a result, individual internalization and adoption of the organization’s ethical prescriptions and proscriptions are highly likely if there is a strong CRE (Dickson et al., 2001). Therefore, we offer the following hypothesis:

H2. There is a positive relationship betweenCRE and INT.

Firms’ socialization and controls (i.e. enforcement of ethical codes and discussion of ethics) for salesforce ethical code internalization is critical for salesforce job performance because firms are using training programs to achieve and maintain a high level of salesforce competence (Bolander et al., 2017). The inclusion of such psychological climate-related perceptions as an organization’s customer orientation, sales innovativeness and sales supportiveness allows for improvement in linking sales controls to salesperson job satisfaction and job performance (Evans et al., 2007; Schwepker and Schultz, 2015). Firms are also increasingly using salesforce training and development activities to increase salesforce productivity due to increased levels of competition, rapidly changing technology and a renewed focus on customer retention and relationships (Attia et al., 2005; Schwepker and Schultz, 2015; Curasi et al., 2018). Resulting from the above discussion, we offer the following hypotheses:

H3. There is a positive relationship between INT and salesperson job performance.

H4. INT moderates the relationship between CRE and salesperson job performance.

The theory of planned behavior and salespersons’ performance of the sales job According to the theory of planned behavior (Ajzen, 2002), human behavior is guided by an individual’s beliefs about the presence of factors that may help or hinder his or her performance of a specific behavior. We refer to a person’s beliefs about factors that can help or hinder his or her ability to perform a behavior as their control beliefs. Control beliefs can be understood by examining both a person’s perceived behavioral control, the perceived ease or difficulty of performing a behavior (Ajzen, 2002), and one’s self-efficacy or that person’s belief in their ability to perform a specific task. Taken together, the theory of planned behavior suggests that a person’s perceived control can be explained by that person’s perceived behavioral control plus their self-efficacy. Perceived behavioral control refers to an individual’s belief

about his or her capability of exerting influence on internal states and behaviors, as well as what they feel can be accomplished in a specific environment, or under a specific set of controls (Wallston et al., 1987). Perceived behavioral control focuses on a person’s perception of their ability to perform a particular behavior in a given environment. This can affect behavior indirectly (by its impact on intention) or directly (Ajzen, 2002). From his meta-analysis, Spector (1986) finds that high levels of perceived control are associated with high levels of job satisfaction, commitment, involvement and performance. These characterizations and findings indicate that a high level

of perceived control will strengthen a person’s intention to perform the behavior and will increase effort and perseverance. Moreover, if perceived control is interpreted accurately it will provide useful information about the actual control that a person can exercise in a situation, and so it can be used as an additional direct predictor of behavior. Perceived behavioral control and self-efficacy are quite similar:

both are concerned with the perceived ability to perform a behavior (or sequence of behaviors) (Ajzen, 2002). Self-efficacy, a key element in Bandura’s (1978) social learning theory, refers to one’s belief in one’s capability to perform a specific task. Scholars and practitioners have embraced the self-efficacy theory because of its applicability in the workplace. Self-efficacy arises from the gradual acquisition of complex cognitive, social, linguistic or physical skills through experience (Bandura, 1982). Individuals appear to weigh, integrate and evaluate information about their capabilities; they then regulate their choices and efforts accordingly (Bandura et al., 1980). Self-efficacy reflects a person’s confidence in their own ability to accomplish a task (Heuven et al., 2006; Nguyen et al., 2017). Overall, self-efficacy positively and strongly effects work-related performance (Judge andBono, 2001; Stajkovic andLuthans, 1998). In a sales context, a company with a strong CRE should also,

therefore, provide a strong foundation of perceived control, with salesforce training and development activities, as well as robust discussions of salesforce ethics. This can be interpreted to suggest the following hypothesis:

H5. There is a positive relationship between CRE and salespersons’ perceived control.

H5a. There is a positive relationship between CRE and perceived behavioral control.

H5b. There is a positive relationship between CRE and self- efficacy.

With the presence of organizational control, individuals experience CRE and interpret it through the internalization (INT) process. With a constant emphasis on salespeople’s adherence to ethical codes, their internalization (INT) continues to modify their job-related cognitions, effects and behaviors, resulting in performance change. This suggests the following hypotheses:

H6. There is a positive relationship between INT and salespersons’ perceived control.

H6a. There is a positive relationship between INT and perceived behavioral control.

H6b. There is a positive relationship between INT and self- efficacy.

H7. INT moderates the relationship between CRE and salespersons’ perceived control.

H7a. INT moderates the relationship between CRE and perceived behavioral control.

H7b. INTmoderates the relationship between CRE and self- efficacy.

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1244

H8. There is a positive relationship between salespersons’ perceived control and salespersons’ job performance.

H8a. There is a positive relationship between perceived behavioral control and salesperson job performance.

H8b. There is a positive relationship between self-efficacy and salesperson job performance.

The internalization process is an experiential learning process (Grundstein-Amado, 2001), in which sales peoples’ perceived control systems (i.e. perceived control and self-efficacy) gradually but continuously, acquired through experiencing CRE, may bridge the effect of control systems and job outcomes. Therefore, CRE indirectly influences job performance, unlike its claimed relationship in the earlier studies (Oliver and Anderson, 1994, 1995; Onyemah and Anderson, 2009), and is supported in the findings of the earlier studies. For example, Weeks et al. (2004) find that organizations’ ethical climate has an indirect effect on performance when using individual commitment to quality and organizational commitment as intervening variables. Jaramillo et al. (2006) also find that an ethical climate indirectly affects job performance through job stress and job attitudes. Therefore, with the presence of intervening variables, the relationship between CRE and job performance may change, thus leading to the following hypotheses:

H9. Salespersons’ perceived control moderates the relationship betweenCRE and job performance.

H9a. Salespersons’ perceived behavioral control moderates the relationship betweenCRE and job performance.

H9b. Salespersons’ self-efficacy moderates the relationship betweenCRE and job performance.

Figure 1 shows the hypothetical model that illustrates the relationships between the constructs considered in this study.

Method

Sample We used a sample of salespeople working in a variety of industries in the USA to ensure variation in ethical climate and

employee responses. We gathered our sample in the spring of 2017 using Amazon’s Mechanical Turk (MTurk) to collect our data for several reasons. First, MTurk participants are slightly more demographically diverse than are standard internet samples, and they are significantly more diverse than typical American college student samples (Hulland and Miller, 2018). Second, recruitment can progress rapidly and inexpensively, with compensation rates and task length effecting participation (Hulland and Miller, 2018). Realistic compensation rates do not affect data quality. Third, MTurk allows researchers to screen study participants for the specific demographic characteristics under investigation. This allowed us to have a sample composed of retail and B2B salespeople, which was needed for this research project, to examine these two types of sales positions with very different work locations and position responsibilities. Fourth, the data obtained are at least as reliable as samples obtained via traditional methods (Buhrmester et al., 2016). Lastly, MTurk have also been used successfully in other business journals, including Journal of Business & Industrial Marketing (Oakley and Bush, 2016), and is used extensively in other marketing journals, including the Journal of Consumer Research, The Journal of Marketing and the Journal of Marketing Research (Hulland andMiller, 2018). Through MTurk, the salespeople had access to a survey

questionnaire. In total, 307 salespeople completed the survey. On average, they have been a salesperson for the past 5.3 years and received 5.4h of ethics training within the past 12months. The average age of the respondents was 37 years, 160 (52%) were women and 143 (47%) were married. Approximately 60% of those responding to the questions indicated that their employer had a formal code of ethics (Table 1).

Measures Seven-point Likert-type scales measured all constructs examined in this research. The ethical environment scale (CRE) was composed of 10 items from Valentine and Barnett (2002). Example items included, “management in this organization disciplines unethical behavior when it occurs” and “ethical behavior is the norm in this organization.” Reliability analysis for CRE resulted in a Cronbach’s alpha of a = 0.931. Most items appeared to be worthy of retention, resulting in a decrease in the alpha if deleted, except one item

Figure 1 Hypothetical model

Organizational control : Climate regarding

ethics (CRE)

Salesperson job performance

(JP)

Perceived controllability: • Perceived control (PC) • Self-efficacy (SE)

Internalization of code of ethics (INT)

H1+

H3+

H5+

H8+

H9

H2+

Mediation

H4

H6+

H7

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1245

(“Top managers of this organization are models of unethical behavior”) because it would increase the alpha if deleted. That itemwas deleted, resulting in nine items with a = 0.954. The INT measure contained four items from Schwepker and

Hartline (2005). Example items included, “I never see or hear the code of ethics mentioned at work” and “I accept the contents of the code of ethics in my work life.”Reliability analysis resulted in a Cronbach’s alpha of a = 0.804. All items appeared to be worthy of retention, resulting in a decrease in the alpha if deleted.

The self-efficacy (SE) measure contained three items adapted from a salesperson measure of self-efficacy (Sujan et al., 1994). Example items included, “I feel I am very capable at the task of selling” and “Overall, I am confident in my ability to perform this job well.” Reliability analysis resulted in a Cronbach’s alpha of a = 0.913. All items appeared to be worthy of retention, resulting in a decrease in the alpha if deleted. We measured perceived behavioral control (PC) with two

items from the seven-item scale developed by Schulz et al. (1995). Reliability analysis revealed a Cronbach’s alpha of a = 0.799. All items appeared to be worthy of retention, resulting in a decrease in the alpha if deleted. Finally, we measured job performance (JP) with the five-

item scale developed by Pettit et al. (1997). Reliability analysis resulted in a Cronbach’s alpha of a = 0.915. All items appeared to be worthy of retention, resulting in a decrease in the alpha if deleted. As a result, CRE comprised nine items; INT comprised four items; SE comprised three items; PC comprised two items; JP comprised five items. In Table 2 we present the factor loadings and the coefficient alpha for all of the constructs.

Data analysis We computed an exploratory factor analysis to investigate the measurement properties of the scales used in this study. Communalities were all greater than 0.50, indicating that

Table 1 Sample characteristics

Variable Category Avg. SD Min. Max. Freq. (%)

Age Total 36.98 9.75 20 67 B2B 37.91 9.84 20 67 Retail 36.50 9.70 20 64

Years in sales Total 5.26 5.01 0.17 35.00 B2B 5.62 5.40 0.42 35.00 Retail 5.08 4.82 0.17 25.00

Training hrs. Total 5.38 14.38 0 180 B2B 6.38 10.38 0 48 Retail 4.86 16.07 0 180

Gender Male 147 48 Female 160 52

Marital status Single 164 53 Married 143 47

Table 2 Factor analyses results

Factor loadings

Ethical environment (CRE) 1. Management in this organization disciplines unethical behavior when it occurs 0.796 2. Penalties for unethical behavior are strictly enforced in this organization 0.849 3. Unethical behavior is punished in this organization 0.786 4. The top managers of this organization represent high ethical standards 0.838 5. People of integrity are rewarded in this organization 0.831 6. Top managers of this organization regularly show that they care about ethics 0.819 7. Ethical behavior is the norm in this organization 0.696 8. Top managers of this organization guide decision-making in an ethical direction 0.841 9. Ethical behavior is rewarded in this organization 0.812

Internalization of ethics codes (INT) 1. My organization has a code of ethics 0.643 2. I never see the code of ethics mentioned at work (R) 0.686 3. The code of ethics confuses me (R) 0.771 4. I accept the contents of the code of ethics in my work life 0.565

Perceived behavior control (PC) 1. I have control over decisions that affect my life 0.739 2. I am satisfied with the amount of control I have over decisions that affect my life 0.766

Self-efficacy (SE) 1. Overall, I am confident of my ability to perform my job well 0.618 2. I feel I am very capable at the task of selling 0.550 3. I feel I have the capabilities to successfully perform this job 0.636

Salesperson job performance (JP) 1. How would rate the quality of your own performance in your job? 0.770 2. How do you think you supervisor would rate the quality of your performance? 0.854 3. How would you rate the quantity of sales of your own performance in your job? 0.769 4. How do you think your supervisor would rate the quantity of sales of your performance? 0.830 5. If your company has a formal evaluation process, how were you rated in your last evaluation? 0.814

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1246

additional data collection was not necessary (Worthington and Whittaker, 2006). Principle components analysis was used and varimax was used as an orthogonal rotation to extract eigenvalues of factors equaling or exceeding one and factor loadings equaling or exceeding the accepted criteria of 0.5 (Hair et al., 2009). We conducted a confirmatory factor analysis using Mplus

8.4 and assessed the CFA using guidelines provided by Hair et al. (2009). The overall model suggested a relatively good fit (x2 of 1,446.445 with 10 degrees of freedom; SRMR = 0.008; RMSEA = 0.151; CFI = 0.995; TLI = 0.952). The average variance extracted is 0.573, which is larger than 0.5, suggesting convergent validity (Hair et al., 2009). We conducted a confidence interval test to assess the discriminant validity of the model constructs. The test provides evidence of discriminant validity since none of the 95% confidence intervals of the factor correlations included 1.0 (Fornell and Larcker, 1981). In addition, we used Harman’s one-factor test to assess whether common method variance (CMV) threatens the validity of our findings. When the majority of the variance can be accounted for by a single factor CMV constitutes a serious threat to validity (Podsakoff et al., 2003). The 44.7% variance explained by a single factor shows that the common method bias is not a major concern in this study (less than 50% cut-off point). We obtained our results by running unrotated, a single-factor constraint of factor analysis using SPSS version 25.

Results

We conducted our data analysis with multiple regression analysis to test the hypotheses. Considering that the data includes two types of salespeople (i.e. B2B and retail salespeople), a separate analysis was conducted to compare the results between the different samples. Table 3 shows the means, standard deviations and correlations for the variables used in the study.

Climate regarding ethics and internalization of ethical codes We conducted several regression analyses to test the relationship between CRE and JP in line with the intervening variable of INT. We examined the significance of the coefficients at each step, as proposed by Baron and Kenny (1986). In the first step, a simple regression analysis was conducted to find the relationship between CRE and JP significant (b = 0.288, t305 = 8.702, p < 0.01). Next, the relationship between CRE and INT was found significant (b = 0.592, t305 = 14.583, p < 0.01). Another simple regression

analysis was conducted with INT predicting JP to find the relationship significant (b = 0.310, t305 = 8.514, p < 0.01). Finally, a multiple regression analysis was conducted with CRE and INT predicting JP to find the relationships significant (CRE on JP: b = 0.180, t304 = 4.248, p < 0.01; INT on JP: b = 0.182, t304 = 3.912, p < 0.01; VIF = 1.723). Therefore, these results support H1, H2 and H3. Our results partially support H4. We used the same steps for the retail and B2B salesperson data to find partial mediation in the retail data only. However, we found no mediation in the B2B data. Our results with the retail salespeople are what would be expected based on past ethical environment organizational research. Our B2B sample, however, did not result in similar findings. CRE did predict JP, but in the B2B sample, INT was no longer significant in the multiple regression. CRE was significant at a 95% confidence level, but the INT variable is no longer is significant in the B2B sample. This is consistent with our argument that salespeople working in the B2B market have different demands on them and work in a very different environment than other organizational employees and including even in-house retail salespeople. This suggests that the very different work responsibilities and work locations of these two employee types impact the INT variable, and the B2B salesperson’s internalization. Table 4 summarizes the results.

Perceived control Next, we examined the perceived control variables (PC and SE) as dependent variables and CRE and INT as independent variables to test their relationships with multiple regression. First, we examined CRE and INT. We found that they were positively related to PC and SE, individually. When CRE and INT were examined together we found that they were significantly related to SE (CRE: b = 0.122, t304 = 2.631, p <

0.01; INT: b = 0.227, t304 = 4.495, p < 0.01) and PC (CRE: b = 0.254, t304 = 4.773, p< 0.01; INT: b = 0.130, t304 = 2.226, p< 0.05). Thus, this indicates a partial mediation effect of INT on the relationship between CRE and the perceived control variables. The Sobel test (Baron and Kenny, 1986; MacKinnon et al., 1995; Sobel, 1982) was conducted to find that the mediation effect is significant (INT on CRE and SE: 4.262, S.E. on CRE and PC: = 0.032, p < 0.01; INT on CRE and PC: z = 2.216, S.E. = 0.035, p< 0.05). These results supportH5,H6 andH7. We conducted the same analyses for the retail and B2B

salesperson data. In the retail data, we found that CRE and INT were significantly related to SE and PC and INT moderated the relationships between CRE and the perceived control variables. In the B2B data, there was not a significant relationship between CRE and INT and SE. Moreover, we found a mixed result in the relationship between CRE and INT and PC: CRE was significant while INT was not significant. Table 5 summarizes the results. We examined JP as a dependent variable to test H8. The

perceived control variables accounted for a variance in JP with R2 of 0.535 (F(2,304) = 174.559, p < 0.01). We found that the perceived control variables were significantly related to JP (SE: b = 0.556, t304 = 12.612, p< 0.01; PC: b = 0.180, t304 = 4.703, p< 0.01). Thus, our analysis supports hypotheses 8.

Table 3 Correlations, reliabilities, means and standard deviations

Variables Y X1 X2 X3 X4 Mean SD

JP 0.92 5.751 0.897 CRE 0.446� 0.95 5.059 1.389 INT 0.438� 0.648� 0.80 5.388 1.268 SE 0.708� 0.375� 0.419� 0.91 6.089 0.950 PC 0.539� 0.421� 0.360� 0.544� 0.80 5.099 1.012

Notes: �Correlations significant at the 0.01 level (two-tailed); Italic values (originally bold) on the diagonal indicate reliabilities

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1247

The intervening role of perceived control To test the intervening role of the perceived control variables in the relationship between CRE and JP, we conducted several regression analyses and examined the significance of the coefficients at each step, as proposed by Baron and Kenny (1986). In the first step, a simple regression analysis was conducted

to find the relationship between CRE and JP significant (b = 0.288, t306 = 8.702, p < 0.01). In the next step, the relationships between CRE and SE and PC were tested separately and found significant (CRE on SE: b = 0.256, t305 = 7.058, p < 0.01; CRE on PC: b = 0.331, t305 = 8.105, p < 0.01). We conducted another regression analysis with PC and SE predicting JP and found the relationships significant. Finally, we conducted a multiple regression analysis with CRE and PC/SE predicting JP to find all the relationships significant, indicating partial mediation. VIFs were less than 2. The Sobel test (Baron and Kenny, 1986; MacKinnon et al., 1995; Sobel, 1982) was conducted to find that the mediation effect is significant (SE: z = 6.414, S.E. = 0.024, p < 0.01; PC: z = 5.814, S.E. = 0.020, p < 0.01). This result supports H9.

We then conducted the same steps for the retail and B2B salesperson data to find partial mediation in both data sets. Table 6 summarizes the results.

Discussion

Climate regarding ethics and internalization of ethical codes Our results show that CRE has a positive impact on salespersons’ ethical code internalization (INT). This finding supports earlier research suggesting that, in situations in which there is a strong CRE, the individual internalization and adoption of the organization’s ethical prescriptions and proscriptions are highly likely (Dickson et al., 2001). The results also demonstrate that CRE and INT have a positive impact on salesperson JP and, more importantly, INT moderates the relationship between CRE and JP. These findings are in line with much earlier research finding that organizational control systems have a confluent effect on salespersons’ job-related cognitions, affects and behaviors (Oliver and Anderson, 1994; Onyemah and Anderson, 2009)

Table 4 Mediation – INT on CRE and JP

Total salespeople B2B salespeople Retail salespeople b S.E. t Sig. b S.E. t Sig. b S.E. t Sig.

CRE1 on JP2 0.288 0.033 8.702 0.000 0.284 0.067 4.255 0.000 0.290 0.038 7.718 0.000 CRE on INT3 0.592 0.040 14.583 0.000 0.651 0.068 9.614 0.000 0.566 0.049 11.465 0.000 INT on JP 0.310 0.036 8.514 0.000 0.279 0.072 3.904 0.000 0.325 0.042 7.783 0.000 CRE/INT on JP 0.180/

0.182 0.042/ 0.047

4.248/ 3.912

0.000/ 0.000

0.195/ 0.137

0.092/ 0.097

2.123/ 1.412

0.036/ 0.161

0.176/ 0.202

0.047/ 0.0542

3.769/ 3.877

0.000/ 0.000

Model summary

R2 = 0.237, F(2,304) = 47.286, p< 0.01. VIF = 1.723

R2 = 0.237, F(2,304) = 47.286, p< 0.01. VIF = 1.906

R2 = 0.237, F(2,304) = 47.286, p< 0.01. VIF = 1.654

Notes: 1CRE = Climate regarding ethics; 2JP = Job performance; 3INT = Internalization of ethical codes

Table 5 Mediation – INT on CRE and perceived control variables

INT on CRE and SE

Total salespeople B2B salespeople Retail salespeople b S.E. t Sig. b S.E. t Sig. b S.E. t Sig.

CRE1 on SE2 0.258 0.036 7.058 0.000 0.237 0.064 3.697 0.000 0.290 0.038 7.718 0.000 CRE on INT3 0.592 0.040 14.583 0.000 0.651 0.068 9.614 0.000 0.566 0.049 11.465 0.000 INT on SE 0.314 0.039 8.061 0.000 0.240 0.068 3.511 0.001 0.325 0.042 7.783 0.000 CRE/INT on SE 0.122/

0.227 0.046/ 0.051

2.631/ 4.495

0.009/ 0.000

0.154/ 0.127

0.088/ 0.093

1.750/ 1.362

0.083/ 0.176

0.111/ 0.269

0.055/ 0.061

2.030/ 4.442

0.044/ 0.000

Model summary R2 = 0.194, F(2,304) = 36.580, p< 0.01. VIF = 1.723

R2 = 0.134, F(2,101) = 7.819, p< 0.01. VIF = 1.906

R2 = 0.225, F(2,200) = 29.103, p< 0.01. VIF = 1.654

INT on CRE and PC

Total salespeople B2B salespeople Retail salespeople b S.E. t Sig. b S.E. t Sig. b S.E. t Sig.

CRE4 on PC5 0.331 0.041 8.106 0.000 0.284 0.067 4.255 0.000 0.344 0.050 6.851 0.000 CRE on INT6 0.592 0.040 14.583 0.000 0.651 0.068 9.614 0.000 0.566 0.049 11.465 0.000 INT on PC 0.310 0.046 6.745 0.000 0.279 0.072 3.904 0.000 0.354 0.057 6.240 0.000 CRE/INT on PC 0.254/

0.130 0.053/ 0.058

4.773/ 2.226

0.000/ 0.027

0.299/ �0.015

0.097/ 0.103

3.087/ �0.142

0.003/ 0.888

0.238/ 0.188

0.064/ 0.071

3.737/ 2.656

0.000/ 0.009

Model summary R2 = 0.190, F(2,304) = 35.758, p< 0.01. VIF = 1.723

R2 = 0.144, F(2,101) = 8.528, p< 0.01. VIF = 1.906

R2 = 0.217, F(2,200) = 27.702, p< 0.01. VIF = 1.654

Notes: 1CRE = Climate regarding ethics; 2SE = Self-efficacy; 3INT = Internalization of ethical codes; 4CRE = Climate regarding ethics; 5PC = Perceived behavioral control; 6INT = Internalization of ethical codes

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1248

Ta bl e 6

M ed ia tio n – pe rc ei ve d co nt ro ls on

CR E an d JP :C om

pa ris on

by sa m pl es

SE on

CR E an

d JP

To ta ls al es pe

op le

B2 B sa le sp eo

pl e

Re ta il sa le sp eo

pl e

b S. E.

t p

b S. E.

t p

b S. E.

t p

CR E1

on JP

2 0. 28 8

0. 03 3

8. 70 2

0. 00 0

0. 28 4

0. 06 7

4. 25 5

0. 00 0

0. 29 0

0. 03 8

7. 71 8

0. 00 0

CR E on

SE 3

0. 25 6

0. 03 6

7. 05 8

0. 00 0

0. 23 7

0. 06 4

3. 69 7

0. 00 0

0. 26 3

0. 04 4

5. 93 3

0. 00 0

SE on

JP 0. 66 8

0. 03 8

17 .4 88

0. 00 0

0. 70 0

0. 17 9

8. 86 7

0. 00 0

0. 65 7

0. 04 3

15 .4 41

0. 00 0

CR E/ SE

on JP

0. 13 6/ 0. 59 4

0. 02 7/ 0. 04 0

5. 00 7/ 14 .9 65

0. 00 0/ 0. 00 0

0. 13 4/ 0. 63 3

0. 05 7/ 0. 08 2

2. 36 2/ 7. 69 9

0. 02 0/ 0. 00 0

0. 13 8/ 0. 57 8

0. 03 0/ 0. 04 4

4. 62 1/ 13 .1 64

0. 00 0/ 0. 00 0

M od

el su m m ar y

R2 = 0. 53 9, F ( 2, 30 4) = 17 7. 51 6, p < 0. 01 ,

VI F = 1. 16 3

R2 = 0. 46 5, F ( 2, 10 1) = 43 .8 61 ,p

< 0. 01

VI F = 1. 13 4

R2 = 0. 58 7, F ( 2, 20 0) = 14 1. 96 0, p < 0. 01

VI F = 1. 17 5

PC on

CR E an

d JP

To ta ls al es pe op le

B2 B sa le sp eo pl e

Re ta il sa le sp eo pl e

b S. E.

t p

b S. E.

t p

b S. E.

t p

CR E4

on JP

5 0. 28 8

0. 03 3

8. 70 2

0. 00 0

0. 28 4

0. 06 7

4. 25 5

0. 00 0

0. 29 0

0. 03 8

7. 71 8

0. 00 0

CR E on

PC 6

0. 33 1

0. 04 1

8. 10 6

0. 00 0

0. 28 9

0. 07 0

4. 14 8

0. 00 0

0. 34 4

0. 05 0

6. 85 1

0. 00 0

PC on

JP 0. 44 4

0. 04 0

11 .1 89

0. 00 0

0. 60 8

0. 07 4

8. 25 7

0. 00 0

0. 38 6

0. 04 7

8. 23 3

0. 00 0

CR E/ PC

on JP

0. 17 2/ 0. 35 2

0. 03 3/ 0. 04 2

5. 21 4/ 8. 38 0

0. 00 0/ 0. 00 0

0. 12 6/ 0. 54 5

0. 06 0/ 0. 07 8

2. 12 0/ 6. 96 2

0. 00 0/ 0. 00 0

0. 19 5/ 0. 27 9

0. 03 9/ 0. 04 9

5. 00 2/ 5. 66 7

0. 00 0/ 0. 00 0

M od

el su m m ar y

R2 = 0. 34 9, F ( 2, 30 4) = 81 .5 67 ,p

< 0. 01

VI F = 1. 21 5

R2 = 0. 42 6, F ( 2, 10 1) = 37 .5 00 ,p

< 0. 01

VI F = 1. 16 9

R2 = 0. 33 5, F ( 2, 20 0) = 50 .4 50 ,p

< 0. 01

VI F = 1. 23 4

N ot es :

1 C RE

= Cl im at e re ga rd in g et hi cs ;2 JP

= Jo b pe rfo

rm an ce ;3 SE

= Se lf- ef fi ca cy ;4 CR

E = Cl im at e re ga rd in g et hi cs ;5 JP

= Jo b pe rfo

rm an ce ;6 PC

= Pe rc ei ve d be ha vi or al co nt ro l

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1249

and support the claim that enforcing ethical codes enhances code internalization, and importantly, job performance (Schwepker and Hartline, 2005; Schwepker and Schultz, 2015). More importantly, these findings support our argument that

organizations’ ethical changes may produce an unexpected outcome on salesperson performance when firms focus attention on heightened ethics. Given the earlier claims and our finding of the relationship between CRE and INT, sales organizations’ ethical control influences the perception that salespeople have of the organizations’ ethical values, and such internalization may limit the contribution of a strong organizational ethical environment on salesperson job- performance, if this results in affecting the salesperson’s feelings of perceived controllability and self-efficacy. That is, the socialization process (e.g. training and mentoring) or other controls (enforcement of ethical codes and discussion of ethics) to enforce tighter ethical standards may not be as beneficial for salespeople job performance as previously expected when a salesperson’s internalization of their organizations’ CRE reduces the direct effect on salespeople job performance. We see this in the data for the B2B salespeople in the variable, SE or self-efficacy. Based on our data, if the B2B salesforce felt overly constrained with heightened ethics standards, it could then effect their belief that they could still perform their jobs adequately (SE). This finding provides a boundary to earlier sales ethics studies, and it also somewhat intuitive. If the heightened ethical standards result in a salesperson feeling that they may not be able to meet their sales goals, it can affect their attitudes and their resulting behaviors. This research may be consistent with some more recent

research suggesting that corporate codes of ethics may be too general and less relevant for the types of ethical dilemmas and ethical issues that B2B salespeople contend with on a regular basis (Bush et al., 2017; Ferrell et al., 2019). Typically high levels of perceived control are associated with high levels of job satisfaction, commitment and performance (Spector, 1986). However, when trying to comply with global corporate-wide codes of conduct, that may be difficult for the sales team to implement and that may be less relevant for the B2B sales position, this could possibly explain the lower feelings of perceived control found in our data. Sales teams should benefit from unique codes of ethics developed specifically for the sales team, accompanied with training designed to help the sales team interpret the sales specific code of ethics that is designed to be more relevant to the types of ethical dilemmas and ethical issues that the B2B sales team faces on a regular basis (Bush et al., 2017; Ferrell et al., 2019). Interestingly, as shown in Table 4, we found no mediation

effect in the B2B data. More investigation is necessary to explain this unexpected finding in the B2B data. Previous research suggests, however, that B2B salespeople are typically characterized by their customer-oriented selling and long-term customer relationship management (Guenzi et al., 2007; Schwepker, 2003). Such characterization of B2B salespeople indicates that their moral behavior is not as subject to self- interest, as defined in terms of physical well-being, pleasure, power, wealth, happiness or other criteria that promote the wishes and interests of an individual (Ferrell and Fraedrich, 1997). B2B salespeople, are thus, generally not led to make

decisions instrumental to their personal interest without regard to the health of the organization, professional codes or even laws.

Perceived control When considered together for their effect on the variables, our results show that CRE and INT both are significant indicators for salespersons’ perceived control variables. When INT was added to the relationships, however, the direct effects of CRE on the variables was reduced. We also found that the perceived control variables

significantly contribute to salesperson job performance. Moreover, from the results of our analysis, we found that the perceived control variables partially moderated the relationship between CRE and JP. This result indicates that the direct effect of the organization’s ethical control will be to reduce salesperson job performance significantly, if it reduces SE. We found the same effect in both samples. These results support our claim that salespersons’ ethical

code internalization and perceived control are both vital to engendering proper job outcomes. With the presence of organizational control, individuals experience CRE and interpret it through an internalization process. Individuals then modify their behaviors by taking on norms or rules as “their own” (Grundstein-Amado, 2001). As claimed, the internalization process is an experiential learning process in which individuals’ perceived control systems (i.e. perceived behavioral control and self-efficacy) bridge the confluent effect of control systems and the job-related cognitions, affects and behaviors while reducing the main effect. Therefore, a high level of perceived control will strengthen a person’s intention to perform the expected behavior and increase effort and perseverance. Moreover, if perceived control is realistic, it will provide useful information about the actual control a person can exercise in the situation and can be used as an additional direct predictor of behavior.

Toomuch of good things can be bad Is too much of a good thing bad for sales organizations? This study finds empirical evidence that the direct effect of tightening the ethical climate on the sales team can hurt salesperson job performance. This finding indicates that organizational practices to enforce ethical control may actually lessen salesperson job performance, if the salesperson feels that his or her self-efficacy would be reduced. This is not to say that strengthening the ethical climate, or the ethical controls within an organization will always hurt salesperson performance, but that it needs to be done carefully because our results suggest that salesperson job performance can be hurt if training and ethical controls reduce perceptions of controllability. As Bolander et al. (2017) found, sometimes when managing new sales employees’ ethical behaviors, even when sales management is trying to help, their help could be detrimental. The findings of our study provide useful insights for sales

organizations incorporating ethical control into their strategic planning process. By understanding factors that affect salespeople’s ethical code internalization, as well as how ethical controls affect salesperson job performance and perceived control, management can take steps to improve organizations’ CRE, improve salesperson performance and provide

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1250

organizations with a competitive advantage. Additional care must be taken to ensure that sales personnel can still feel that they have adequate control over the responsibilities of their job. That is, care needs to be taken to ensure that the sales team can maintain perceived behavioral control, and can have confidence in their self-efficacy so that they can feel that they are able tomaintain their stated position goals. This is an area that can be especially helpful for the sales

team since previous research has found that corporate-level codes of ethics and training programs are often too general and too broad for clear application for the organization’s salesforce. The corporate codes of ethics typically do not apply well to the ethical dilemmas and the unclear ethical issues that salespeople must deal with on a regular basis (Bush et al., 2017; Ferrell et al., 2019). Thus, based on the findings of this research and other recent research investigating sales ethics, we suggest that companies develop a code of ethics specifically for the sales team, along with training that can illuminate the expectations that are distinctive for the sales team and the unique position they often find themselves in due to the different set of job characteristics that these employees must traverse (Bush et al., 2017; Ferrell et al., 2019). Our results suggest that when making changes to the

corporate CRE that perceived controllability and self-efficacy of the sales team should be considered. Training covering changes in the demands of the job or in how the sales position should be conducted should include training reassuring and demonstrating to the sales force that their goals and objectives can still be met, as outlined above. Management should assess salespeople regarding their confidence in meeting goals when changes are made, understanding that if the sales team truly does not believe that they can attain the goals and objectives set out before them that their sales performance could be affected. Management should also consider having more senior employees mentor those salespeople with less experience and less confidence, as the more experienced employees have more longevity on the job and have probably been better able to cope with stress than the employees with less work experience. From a theoretical perspective, our findings contribute to the

understanding of the role of salespersons’ ethical code internalization and their perceived control by explaining how the variables can be influential to the direct effect of CRE on the job performance of salespeople. Our findings also contribute to research by advancing our knowledge of how we can enhance the job performance of salespeople working within an organization’s ethical control while leading to higher customer satisfaction and improved sales performance.

Future directions and limitations Additional investigations are necessary for testing the mediating effect of INT on the relationships between CRE and perceived control variables in the B2B sales context. In the current study, B2B data showed no mediation effect present in the relationship while both the combined and the retail data showed that INTmoderated the relationships. This study presents the empirical findings to support the

claim of the marginal effect of organizational control on salesperson job performance, especially focusing on the CRE perspective. Nevertheless, to address the inherent limitation of the current study and to support the generalization of the claim

made in this study, we identify the following questions for future research. Research question 1. Will the different job characteristics of B2B

salespeople make their organizational ethical climate more effective? As shown in Table 4, there seems to be a difference in how B2B salespeople internalize the organizational ethical climate when compared to retail salespeople. That is, B2B firms’ ethical disciplinary enforcement may be more effective than that of retail firms. A possible explanation is that B2B salespeople typically perform more customer-oriented selling, and demonstrate longer-term customer relationship management. However, more investigation is necessary to explain the unexpected finding in the B2B salesperson data. Research question 2: Which types of ethical climate will be more

vulnerable in the presence of mediating variables that change the magnitude of the relationship between CRE and salespeople job performance? A study by Cullen et al. (2003) showed mixed results when it considered the three types of organization’s ethical climate (i.e. egoistic, benevolent and principled climate) as defined by Victor and Cullen (1988) to investigate their relationship with organizational commitment. Egoistic climate, in their study, shows a negative relationship with organizational commitment, and the two other types of climates, benevolent and principled climates, demonstrate a positive relationship to organizational commitment. Tsai and Huang (2008) used three types of organization’s ethical climate (i.e. caring, independent and law and code) to find that each climate has a different (i.e. positive or negative) influence on job satisfaction and organizational commitment, while an organization can still improve job satisfaction and organizational commitment by influencing its ethical climate. Other research also finds a relationship between individual employees’ diverse perceptions of the organization’s ethical climate and an associated impact on job satisfaction. Elçi and Alpkan (2009) observed the presence of nine perceived ethical climate types in the telecommunication industry and found that the self-interest climate type appears to influence work satisfaction negatively. In contrast, team interest, social responsibility and law and professional codes climate-types conversely have a positive impact on work satisfaction. These findings indicate that proper identification of the effect

of an organization’s ethical climate on salespersons’ job attitude variables (e.g. organizational commitment or job satisfaction) demands a characterization of the type of the organization’s ethical climate that the salespeople are experiencing within their organization. Research examining the relationship between different types of organizations’ ethical climates and the job attitude variables in the sales context is scarce. Research question 3: Does salespersons’ knowledge, skills and

abilities (KSAs) change the magnitude of the relationship and produce changes in the outcome? Job-related skills relate positively to role breadth and job performance (Morgeson et al., 2005). Salespersons’ perceptions of the importance of specific sales skills and behaviors relate positively to sales performance, customer orientation and job satisfaction (Pettijohn et al., 2007). Moreover, KSA evolves according to specific environments and situation changes and is different for everyone. We make a conjecture that salespersons’ INT is different for individual salespersons and may change the magnitude of the relationship between CRE and job

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1251

performance. Thus, an empirical study on its possible moderating or mediating effect on the relationship is necessary to find different levels of individual KSA resulting in different (or unexpected) levels of outcomes. Contrary to many firms’ expectations we find that a change

in ethical practices can have a negative impact on salesperson performance due to perceptions of reduced self-efficacy or a belief that they may not be able to achieve their stated goals under the heightened restraints. With this as the result, instead of increasing the job performance of salespeople, we instead see their job performance decrease. This unexpected consequence occurs because organizations’ ethical controls, such as an ethical climate within a firm, may have a limiting role for salespeople. Salespersons’ internalization of the tightened ethical codes effects job-related cognitions, affects and behaviors, with our data suggesting that in some cases salespeople may feel that they do not have the ability to continue to maintain their stated production goals. This occurrence also moderates the relationship, thus reducing the direct and positive effect of organizational ethical climate on salesperson job performance. Therefore, we argue that too much of a good thing, in the form of ethical controls, can be a detriment for sales organizations. Too much of good thing can be bad. Profit maximization is the

goal of most business organizations, and it provides a good rationale for organizations to keep paying extra attention to organizational controls for employees. Some may argue that adherence to ethical standards is a vital aspect of sales quality. Performance measures, too, for ethics, should be a component of quality assessment and reporting in sales management because measures of ethics quality are likely to be complementary to traditional performance measures, and they may improve overall quality measurement (Fox et al., 2010; Wynia, 1999). Nevertheless, the evidence in this study shows that toomuch good thing can be bad for organizations if not implemented carefully.

References

Ajzen, I. (2002), “Perceived behavioral control, self-efficacy, locus of control, and the theory of planned behavior”, Journal of Applied Social Psychology, Vol. 32No. 4, pp. 665-683.

Allen, N.J. and Meyer, J.P. (1990), “The measurement and antecedents of affective, continuance and normative commitment to the organization”, Journal of Occupational Psychology, Vol. 63No. 1, pp. 1-18.

Attia, A.M., Honeycutt, E.D., Jr. and Leach, M.P. (2005), “A three-stage model for assessing and improving sales force training and development”, Journal of Personal Selling& Sales Management, Vol. 25No. 3, pp. 253-268.

Babin, B.J., Boles, J.S. and Robin, D.P. (2000), “Representing the perceived ethical work climate among marketing employees”, Journal of the Academy of Marketing Science, Vol. 28No. 3, pp. 345-358.

Bandura, A. (1978), “Social learning theory of aggression”, Journal of Communication, Vol. 28No. 3, pp. 12-29.

Bandura, A. (1982), “Self-efficacy mechanism in human agency”,American Psychologist, Vol. 37No. 2, p. 122.

Bandura, A., Adams, N.E., Hardy, A.B. and Howells, G.N. (1980), “Tests of the generality of self-efficacy theory”, Cognitive Therapy and Research, Vol. 4No. 1, pp. 39-66.

Baron, R.M. and Kenny, D.A. (1986), “The moderator– mediator variable distinction in social psychological research: conceptual, strategic, and statistical considerations”, Journal of Personality and Social Psychology, Vol. 51No. 6, p. 1173.

Bolander, W., Zahn, W.L., Loe, T.W. and Clark, M. (2017), “Managing new salespeople’s ethical behaviors during repetitive failures: when trying to help actually hurts”, Journal of Business Ethics, Vol. 144No. 3, pp. 519-532.

Boles, J., Johnston, W.J. and Gardner, A. (1999), “The selection and organization of national accounts: a North American perspective”, Journal of Business & Industrial Marketing, Vol. 14No. 4, pp. 264-282.

Buhrmester, M., Kwang, T. and Gosling, S.D. (2016), “Amazon’s mechanical turk: a new source of inexpensive, yet high-quality data?”, in Kazdin, A.E. (Ed.), Methodological Issues and Strategies in Clinical Research, American Psychological Association, pp. 133-139.

Bush, V., Bush, A.J., Oakley, J. and Cicala, J.E. (2017), “The sales profession as a subculture: Implications for ethical decision making”, Journal of Business Ethics, Vol. 142, pp. 549-565.

Cullen, J.B., Parboteeah, K.P. and Victor, B. (2003), “The effects of ethical climates on organizational commitment: a two-study analysis”, Journal of Business Ethics, Vol. 46 No. 2, pp. 127-141.

Curasi, C.F., Boles, J. and Reynolds, R. (2018), “Key account buying team members’ emotional responses awarding multi-million dollar sales contract”, Industrial Marketing Management, Vol. 75, pp. 193-205.

Dickson, M.W., Smith, D.B., Grojean, M.W. and Ehrhart, M. (2001), “An organizational climate regarding ethics: the outcome of leader values and the practices that reflect them”, The Leadership Quarterly, Vol. 12No. 2, pp. 197-217.

Dukerich, J.M., Nichols, M.L., Elm, D.R. and Vollrath, D.A. (1990), “Moral reasoning in groups: leaders make a difference”,HumanRelations, Vol. 43No. 5, pp. 473-493.

Elçi, M. and Alpkan, L. (2009), “The impact of perceived organizational ethical climate on work satisfaction”, Journal of Business Ethics, Vol. 84No. 3, pp. 297-311.

Erben, G.S. and Günes�er, A.B. (2008), “The relationship between paternalistic leadership and organizational commitment: investigating the role of climate regarding ethics”, Journal of Business Ethics, Vol. 82 No. 4, pp. 955-968.

Evans, K.R., Landry, T.D., Li, P.C. and Zou, S. (2007), “How sales controls affect job-related outcomes: the role of organizational sales-related psychological climate perceptions”, Journal of the Academy of Marketing Science, Vol. 35 No. 3, pp. 445-459.

Ferrell, O.C. and Fraedrich, J. (1997), Business Ethics, 3rd ed., HoughtonMifflin Co., Boston.

Ferrell, O.C., Johnston, M.W., Marshall, G.W. and Ferrell, L. (2019), “A new direction for sales ethics research: the sales ethics subculture”, Journal of Marketing Theory and Practice, Vol. 27No. 3, pp. 282-297.

Fornell, C. and Larcker, D.F. (1981), “Evaluating structural equation models with unobservable variables and measurement error”, Journal of Marketing Research, Vol. 18 No. 1, pp. 39-50.

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1252

Fox, E., Bottrell, M.M., Berkowitz, K.A., Chanko, B.L., Foglia, M.B. and Pearlman, R.A. (2010), “Integrated ethics: an innovative program to improve ethics quality in health care”, Innovation Journal, Vol. 15No. 2, pp. 1-36.

Friend, S.B., Curasi, C.F., Boles, J.S. and Bellenger, D.N. (2014), “Why are you really losing sales opportunities? A buyer’s perspective on the determinants of key account sales failure”, Industrial Marketing Management, October, Vol. 43 No. 7, pp. 1124-1135.

Friend, S.B., Jaramillo, F. and Johnson, J.S. (2020), “Ethical climate at the frontline: a meta-analytic evaluation”, Journal of Service Research, Vol. 23No. 2, pp. 116-138.

Grundstein-Amado, R. (2001), “A strategy for formulation and implementation of codes of ethics in public service organizations”, International Journal of Public Administration, Vol. 24No. 5, pp. 461-478.

Guenzi, P., Pardo, C. and Georges, L. (2007), “Relational selling strategy and key account managers’ relational behaviors: an exploratory study”, Industrial Marketing Management, Vol. 36No. 1, pp. 121-133.

Hair, J.F., Jr, Black William, C., Babin Barry, J. and Anderson Ralph, E. (2009), Multivariate Data Analysis, 7th ed., Prentice-Hall, Upper Saddle River, NJ.

Heuven, E., Bakker, A.B., Schaufeli, W.B. and Huisman, N. (2006), “The role of self-efficacy in performing emotion work”, Journal of Vocational Behavior, Vol. 69 No. 2, pp. 222-235.

Hijal-Moghrabi, I., Sabharwal, M. and Berman, E.M. (2017), “The importance of ethical environment to organizational performance in employment at will states”, Administration & Society, Vol. 49No. 9, pp. 1346-1374.

Hulland, J. and Miller, J. (2018), “Keep on Turkin?”, Journal of the Academy of Marketing Science, Vol. 46 No. 5, pp. 789-794.

Itani, O.S., Jaramillo, F. and Chonko, L. (2019), “Achieving top performance while building collegiality in sales: it all starts with ethics”, Journal of Business Ethics, Vol. 156 No. 2, pp. 417-438.

Jaramillo, F., Mulki, J.P. and Solomon, P. (2006), “The role of ethical climate on salesperson’s role stress, job attitudes, turnover intention, and job performance”, Journal of Personal Selling&SalesManagement, Vol. 26No. 3, pp. 271-282.

Jaworski, B.J. (1988), “Toward a theory of marketing control: environmental context, control types, and consequences”, Journal ofMarketing, Vol. 52No. 3, pp. 23-39.

Johnston,W.J. and Kim, K. (1994), “Performance, attribution, and expectancy linkages in personal selling”, Journal of Marketing, Vol. 58No. 4, pp. 68-81.

Jones, G.R. (1986), “Socialization tactics, self-efficacy, and newcomers’ adjustments to organizations”, Academy of Management Journal, Vol. 29No. 2, pp. 262-279.

Judge, T.A. and Bono, J.E. (2001), “Relationship of core self- evaluations traits – self-esteem, generalized self-efficacy, locus of control, and emotional stability – with job satisfaction and job performance: a meta-analysis”, Journal of Applied Psychology, Vol. 86No. 1, p. 80.

Kaptein, M. (2015), “The effectiveness of ethics programs: the role of scope, composition, and sequence”, Journal of Business Ethics, Vol. 132No. 2, pp. 415-431.

McClaren, N. (2015), “The methodology in empirical sales ethics research: 1980-2010”, Journal of Business Ethics, Vol. 127No. 1, pp. 121-147.

MacKinnon, D.P., Warsi, G. and Dwyer, J.H. (1995), “A simulation study of mediated effect measures”, Multivariate Behavioral Research, Vol. 30No. 1, pp. 41-62.

Matthyssens, P. and Johnston, W.J. (2006), “Marketing and sales: optimization of a neglected relationship”, Journal of Business& IndustrialMarketing, Vol. 21No. 6, pp. 338-345.

Merkle, A.C., Hair, J.F., Ferrell, O.C., Ferrell, L.K. and Wood, B.G. (2020), “An examination of pro-stakeholder unethical behavior in the sales ethics subculture”, Journal of Marketing Theory and Practice, Vol. 28No. 4, pp. 418-435.

Mora Cortez, R. and Johnston, W.J. (2017), “The future of B2Bmarketing theory: a historical and prospective analysis”, IndustrialMarketingManagement, Vol. 66, pp. 90-102.

Morgeson, F.P., Delaney-Klinger, K. and Hemingway, M.A. (2005), “The importance of job autonomy, cognitive ability, and job-related skill for predicting role breadth and job performance”, Journal of Applied Psychology, Vol. 90 No. 2, p. 399.

Nguyen, H., Johnson, A., Collins, C. and Parker, S.K. (2017), “Confidence matters: self-efficacy moderates the credit that supervisors give to adaptive and proactive role behaviours”, British Journal ofManagement, Vol. 28No. 2, pp. 315-330.

Oakley, J. and Bush, A.J. (2016), “The role of suspicion in B2B customer entertainment”, Journal of Business & Industrial Marketing, Vol. 11No. 5, pp. 565-574.

Oliver, R.L. and Anderson, E. (1994), “An empirical test of the consequences of behavior-and outcome-based sales control systems”, Journal ofMarketing, Vol. 58No. 4, pp. 53-67.

Oliver, R.L. and Anderson, E. (1995), “Behavior-and outcome-based sales control systems: evidence and consequences of pure-form and hybrid governance”, Journal of Personal Selling & Sales Management, Vol. 15 No. 4, pp. 1-15.

Onyemah, V. and Anderson, E. (2009), “Inconsistencies among the constitutive elements of a sales force control system: test of a configuration theory-based performance prediction”, Journal of Personal Selling & Sales Management, Vol. 29No. 1, pp. 9-24.

Pettijohn, C.E., Pettijohn, L.S. and Taylor, A.J. (2007), “Does salesperson perception of the importance of sales skills improve sales performance, customer orientation, job satisfaction, and organizational commitment, and reduce turnover?”, Journal of Personal Selling & Sales Management, Vol. 27No. 1, pp. 75-88.

Pettit, J.D., Jr, Goris, J.R. and Vaught, B.C. (1997), “An examination of organizational communication as a moderator of the relationship between job performance and job satisfaction”, Journal of Business Communication, Vol. 34 No. 1, pp. 81-98.

Piercy, N.F., Cravens, D.W., Lane, N. and Vorhies, D.W. (2006), “Driving organizational citizenship behaviors and salesperson in-role behavior performance: the role of management control and perceived organizational support”, Journal of the Academy of Marketing Science, Vol. 34 No. 2, pp. 244-262.

Podsakoff, P.M., MacKenzie, S.B., Lee, J.Y. and Podsakoff, N. P. (2003), “Common method biases in behavioral research: a

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1253

critical review of the literature and recommended remedies”, Journal of Applied Psychology, Vol. 88No. 5, p. 879.

Ritter, T., Wilkinson, I.F. and Johnston, W.J. (2002), “Measuring network competence: some international evidence”, Journal of Business & Industrial Marketing, Vol. 17 Nos 2/3, pp. 119-138.

Schneider, B., Ehrhart, M.G. and Macey, W.H. (2013), “Organizational climate and culture”, Annual Review of Psychology, Vol. 64No. 1, pp. 361-388.

Schulz, A.J., Israel, B.A., Zimmerman, M.A. and Checkoway, B.N. (1995), “Empowerment as a multi-level construct: perceived control at the individual, organizational and community levels”,Health Education Research, Vol. 10No. 3, pp. 309-327.

Schwepker, C.H. Jr. (2003), “Customer-oriented selling: a review, extension, and directions for future research”, Journal of Personal Selling & Sales Management, Vol. 23 No. 2, pp. 151-171.

Schwepker, C.H., Jr. and Hartline, M.D. (2005), “Managing the ethical climate of customer-contact service employees”, Journal of Service Research, Vol. 7 No. 4, pp. 377-397.

Schwepker, C.H., Jr. and Ingram, T.N. (1996), “Improving sales performance through ethics: the relationship between salesperson moral judgement and job performance”, Journal of Business Ethics, Vol. 15No. 11, pp. 1151-1160.

Schwepker, C.H., Jr. and Ingram, T.N. (2016), “Ethical leadership in the salesforce: effects on salesperson customer orientation, commitment to customer value, and job stress”, Journal of Business & Industrial Marketing, Vol. 31 No. 7, pp. 914-927.

Schwepker, C.H., Jr. and Schultz, R.J. (2015), “Influence of the ethical servant leader and ethical climate on customer value enhancing sales performance”, Journal of Personal Selling&SalesManagement, Vol. 35No. 2, pp. 93-107.

Sobel, M.E. (1982), “Asymptotic intervals for indirect effects in structural equations models”, in Leinhart, S. (Ed.), Sociological Methodology, Jossey-Bass, San Francisco, pp. 290-312.

Spector, P.E. (1986), “Perceived control by employees: a meta- analysis of studies concerning autonomy and participation at work”,HumanRelations, Vol. 39No. 11, pp. 1005-1016.

Stajkovic, A.D. and Luthans, F. (1998), “Self-efficacy and work-related performance: a meta-analysis”, Psychological Bulletin, Vol. 124No. 2, p. 240.

Sujan, H., Weitz, B.A. and Kumar, N. (1994), “Learning orientation, working smart, and effective selling”, Journal of Marketing, Vol. 58No. 3, pp. 39-52.

Treviño, L.K., Butterfield, K.D. and McCabe, D.L. (2001), “The ethical context in organizations: influences on employee attitudes and behaviors”, Dienhart, J., Moberg, D. and Duska, R. (Eds), Research in Ethical Issues in Organization, Vol. 3, The Next Phase of Business Ethics: Integrating Psychology and Ethics, JAI/Elsevier, Kidlington, Oxford, UK, pp. 301-337.

Tsai, M.T. and Huang, C.C. (2008), “The relationship among ethical climate types, facets of job satisfaction, and the three components of organizational commitment: a study of nurses in Taiwan”, Journal of Business Ethics, Vol. 80 No. 3, pp. 565-581.

Valentine, S. and Barnett, T. (2002), “Ethics codes and sales professionals’ perceptions of their organizations’ ethical values”, Journal of Business Ethics, Vol. 40 No. 3, pp. 191-200.

Victor, B. and Cullen, J.B. (1988), “The organizational bases of ethical work climates”, Administrative Science Quarterly, Vol. 33No. 1, pp. 101-125.

Wallston, K.A., Wallston, B.S., Smith, S. and Dobbins, C.J. (1987), “Perceived control and health”, Current Psychology, Vol. 6 No. 1, pp. 5-25.

Weaver, G.R., Trevino, L.K. and Cochran, P.L. (1999), “Corporate ethics programs as control systems: influences of executive commitment and environmental factors”, Academy of Management Journal, Vol. 42 No. 1, pp. 41-57.

Weeks, W.A., Loe, T.W., Chonko, L.B. and Wakefield, K. (2004), “The effect of perceived ethical climate on the search for sales force excellence”, Journal of Personal Selling & Sales Management, Vol. 24No. 3, pp. 199-214.

Weeks, W.A. and Nantel, J. (1992), “Corporate codes of ethics and sales force behavior: a case study”, Journal of Business Ethics, Vol. 11No. 10, pp. 753-760.

Worthington, R.L. and Whittaker, T.A. (2006), “Scale development research: a content analysis and recommendations for best practices”, The Counseling Psychologist, Vol. 34 No. 6, pp. 806-838.

Wynia, M.K. (1999), “Performance measures for ethics quality”, Effective Clinical Practice: ECP, Vol. 2 No. 6, pp. 294-298.

Corresponding author Carolyn Folkman Curasi can be contacted at: ccurasi@gsu. edu

For instructions on how to order reprints of this article, please visit our website: www.emeraldgrouppublishing.com/licensing/reprints.htm Or contact us for further details: [email protected]

Impact of ethical controls

Joon-Hee Oh, Wesley J. Johnston and Carolyn Folkman Curasi

Journal of Business & Industrial Marketing

Volume 37 · Number 6 · 2022 · 1241–1254

1254

Reproduced with permission of copyright owner. Further reproduction prohibited without permission.