88.
Why are managers a vital stakeholder group?
Managers are a vital stakeholder group because they are responsible for using a
company’s financial capital and human resources to increase its performance and thus its
stock price. Managers are the stakeholder group that bears the responsibility to decide
which goals an organization should pursue to most benefit stakeholders and how to make
the most efficient use of resources to achieve those goals.
AACSB: Analytical Thinking
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 03-01 Illustrate how ethics help managers determine the right way to behave when dealing with
different stakeholder groups.
Topic: Internal Stakeholders
89.
Explain why customers are considered to be the most critical stakeholder group.
Customers are often regarded as the most critical stakeholder group because if a company
cannot attract them to buy its products, it cannot stay in business. Thus managers and
employees must work to increase efficiency and effectiveness in order to create loyal
customers and attract new ones. They do so by selling customers quality products at a fair
price and providing good after-sales service. Many laws protect customers from
companies that attempt to provide dangerous or shoddy products. Laws allow customers
AACSB: Ethics
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 03-01 Illustrate how ethics help managers determine the right way to behave when dealing with
different stakeholder groups.
Topic: External Stakeholders
90.
Describe the four ethical rules or principles and discuss their managerial implications.
To help themselves and employees make ethical decisions and behave in ways that
benefit their stakeholders, managers can use four ethical rules or principles to analyze the
effects of their business decisions on stakeholders: the utilitarian, moral rights, justice,
and practical rules.
• The utilitarian rule proposes that decisions should favor the greatest good for the
greatest number of people. Under this model, a manager should contrast alternative
courses of action, comparing the benefits and costs they bring for various stakeholder
groups.
• The moral rights rule proposes that decisions should protect the basic rights and
privileges of people affected by the decision. In this model, the manager would compare
Topic: Code of Ethics
91.
Describe the questions that a manager should ask under the practical rule to decide if a
business decision is acceptable on ethical grounds.
Under the practical rule a business decision is probably acceptable on ethical grounds if a
manager can answer yes to each of these questions:
• Does my decision fall within the accepted values or standards that typically apply in
business activity today?
• Am I willing to see the decision communicated to all people and groups affected by it—
for example, by having it reported in newspapers or on television?
• Would the people with whom I have a significant personal relationship, such as family
members, friends, or even managers in other organizations, approve of the decision?
AACSB: Analytical Thinking
AACSB: Ethics
Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 03-01 Illustrate how ethics help managers determine the right way to behave when dealing with
different stakeholder groups.
Topic: Code of Ethics
92.
Summarize the reasons why managers should behave ethically.
Relentless pursuit of self-interest can lead to a collective disaster when one or more
people start to profit from being unethical because this encourages other people to act in
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 03-02 Explain why managers should behave ethically and strive to create ethical organizational
cultures.
Topic: Code of Ethics
93.
Identify and describe the sources of an organization’s code of ethics.
An organization’s code of ethics derives from three principal sources in the organizational
environment: societal ethics, professional ethics, and the individual ethics of the
organization’s managers and employees.
• Societal ethics are standards of how members of a society should treat one another in
matters involving issues such as fairness, justice, and individual rights. They derive from a
society’s laws, customs, practices, norms, and values.
• Professional ethics govern how members of a profession, trade, or craft should conduct
themselves when performing work-related activities. They derive from professional
training and socialization.
• Individual ethics are personal standards and values that determine how individuals
should act when self-interest is at stake. They derive from family, peers, upbringing, and
experience.
AACSB: Analytical Thinking
AACSB: Ethics
94.
Describe the major provisions of Title VII of the Civil Rights Act of 1964, the Equal Pay Act,
and the Americans with Disabilities Act.
Some of the major equal employment opportunity legislation that prohibits discrimination
among diverse groups is
• Title VII of the Civil Rights Act of 1964 prohibits discrimination in employment decisions
on the basis of race, religion, sex, color, or national origin. Decisions include hiring, firing,
pay, promotion, and working conditions.
• The Equal Pay Act requires men and women to be paid equally if they are performing
equal work.
• The Americans with Disabilities Act prohibits discrimination against disabled individuals
in employment decisions and requires employers to make accommodations for disabled
workers to enable them to perform their jobs.
Refer: Table 3.1
AACSB: Analytical Thinking
AACSB: Ethics
Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 03-03 Appreciate the increasing diversity of the workforce and of the organizational environment.
Topic: Diversity
95.
Discuss how a manager should deal with religious diversity.
A key issue for managers when it comes to religious diversity is recognizing different
religions and their beliefs, with particular attention being paid to when religious holidays
fall. Critical meetings should not be scheduled during a holy day for members of a certain
faith. Managers should be flexible in allowing people to have time off for religious
observances. Allowing employees to leave work early on certain days instead of taking a
lunch break or posting holidays for different religions on the company calendar can go a
long way toward making individuals of diverse religions feel respected and valued as well
as enable them to practice their faith.
AACSB: Analytical Thinking
AACSB: Ethics
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 03-03 Appreciate the increasing diversity of the workforce and of the organizational environment.
Topic: Diversity
96.
Does the Americans with Disabilities Act (ADA) cover AIDS? Why are employers
sometimes reluctant to hire these individuals? What should employers do about this?
The Americans with Disabilities Act (ADA) prohibits discrimination against those who test
positive for HIV or AIDS. Sometimes, managers themselves or other subordinates may be
reluctant to work with persons who test positive, out of fear, prejudice, or ignorance.
Employers have an obligation to educate all employees, including managers, about the
nature of these conditions, to treat these employees fairly, and to accommodate their
conditions.
AIDS awareness training can help people overcome their fears and provide managers with
a tool to prevent illegal discrimination against HIV-infected employees. Such training
focuses on educating employees about HIV and AIDS, dispelling myths, communicating
relevant organizational policies, and emphasizing the rights of HIV-positive employees to
privacy and an environment that allows them to be productive.
AACSB: Analytical Thinking
AACSB: Ethics
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 03-03 Appreciate the increasing diversity of the workforce and of the organizational environment.
Topic: Diversity
97.
List and give examples of any three managerial roles that could be exercised to effectively
manage diversity.
Students can list any of the following managerial roles.
Figurehead – A manager conveys that the effective management of diversity is a valued
goal and objective.
Leader – A manager serves as a role model and institutes policies and procedures to
ensure that diverse members are treated fairly.
Liaison – A manager enables diverse individuals to coordinate their efforts and cooperate
with one another.
Monitor – A manager evaluates the extent to which diverse employees are being treated
fairly.
Disseminator – A manager informs employees about diversity policies and initiatives and
98.
It has been said that managing diversity makes good business sense. Do you agree or
disagree with this statement? Defend your argument with either pros or cons.
The diversity of organizational members can be a source of competitive advantage that
helps an organization provide customers with better goods and services. Managing
diversity makes business sense because customers of businesses are becoming more
diverse, and, as learned earlier, an organization must be responsive to its customers. A
company with a diverse workforce can understand the needs of these varied customers
more effectively.
Also, a more diverse workforce, utilized well, can yield more creative decisions when the
diverse employees contribute different ideas to the problem-solving process. Third,
effective management of diversity can reduce employee turnover by creating a better work
climate for all employees.
Another way in which the effective management of diversity can positively affect
profitability is that it increases retention of valued employees. This decreases the costs of
hiring replacements for those who quit. It helps ensure that all employees are highly
motivated.
Finally, effective management of diversity reduces the probability of discrimination
lawsuits.
99.
Write a brief note on the two basic forms of sexual harassment.
The two basic forms of sexual harassment are quid pro quo sexual harassment and hostile
work environment sexual harassment.
Quid pro quo sexual harassment occurs when a harasser asks or forces an employee to
perform sexual favors to keep a job, receive a promotion, receive a raise, obtain some
other work-related opportunity, or avoid receiving negative consequences such as
demotion or dismissal.
Hostile work environment sexual harassment is more subtle. It occurs when organizational
members face an intimidating, hostile, or offensive work environment because of their sex.
Lewd jokes, sexually oriented comments or innuendos, vulgar language, displays of
pornography, displays or distribution of sexually oriented objects, and sexually oriented
remarks about one’s physical appearance are examples of hostile work environment
sexual harassment.
AACSB: Analytical Thinking
AACSB: Ethics
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 03-06 Understand the two major forms of sexual harassment and how they can be eliminated.
Topic: Diversity
100.
There are a number of actions that managers can take to reduce and eliminate sexual
harassment on the job. Discuss two of the four common steps that managers can take in
an attempt to deal with this type of problem on the job.
The students may discuss any of the following four steps:
• Develop and clearly communicate a sexual harassment policy endorsed by top
management. This policy should include prohibitions against both quid pro quo and hostile
work environment sexual harassment. It should contain (a) examples of types of behavior
3-84
AACSB: Analytical Thinking
AACSB: Ethics
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 03-06 Understand the two major forms of sexual harassment and how they can be eliminated.
Topic: Diversity