BUSINESS ETHICS - HRM

BUSINESS ETHICS - HRM

Human Resource Management (HRM) deals with work force management, manpower planning and other employee related activities in an organization. Therefore, we can say that it is a special branch of management where ethics play a crucial role. HRM concerns human issues, especially those related with compensation, development, industrial relations, health and safety issues. However, there are sufficient disagreements in managing HRM issues that stem from various quarters.

Ethics and Market System

Various types of market systems affect business and HR ethics differently and hence, business ethics becomes negotiable. Occupations in which the market conditions do not favor the employees, it becomes necessary to have government and labor union interventions for controlling the possible exploitation of employees.

Free market systems empower employees and the employers equally; negotiations are used to create win-win situations for both of these parties. Government or labor union interventions are often harmful in free market systems because they stall the operations and create unnecessary hindrances.

With the growth of globalization, the concept of globalizing labor has gained importance. Trade unions have ceased to exist and the role of HR as such in issues like employee management, desirable policies and practices has become debatable topics.

Many people now have the opinion that HR is nothing but a part of the stakeholders, which initiates major strategic and policy decisions to divulge the organization and gear it towards profit making.

There cannot be a single opinion about ethics in HR that is completely convincing. Market is neither an ethical institution nor an unethical one; no policies and procedures can govern and align the markets for human well-being. However, the need of these policies and procedures cannot be denied or ignored because human development is the ultimate aim of all human initiatives.

HRM Ethics

Out of all organizational issues or policies, ethical considerations are the most difficult to deal with. Issues arise in employment, remuneration and benefits, industrial relations and health and safety.

Important Clusters of HRM related with Ethics

Some HRM issues are more important than the rest because we, as human beings, are more responsible for the development and empowerment of the human resources involved in the operation and management of organizations. Some of these issues are discussed below.

CASH AND COMPENSATION PLANS

There are some general ethical issues pertaining to the employee salaries, executive perquisites and compensations and the annual incentive plans, etc. The HR department is often under pressure to increase the band of base salaries. There is always an increased pressure upon the HR function to pay out more incentives to the top management and provide justification for the same to retain them.

Further, ethical issues arise when HR deals with long-term compensation and incentive plans by consulting with the CEO or an external consultant. There is a pressure on the HR managers on favouring the interests of the top management in comparison to that of the other employees and stakeholders.

RACE, GENDER, AND DISABILITY

There are several examples of organizations where, until recently, the employees were treated differently based on the race, gender, origin, and their disability. This is not the case anymore since the evolution of laws and a regulatory framework standardized for the employee behavior. In ethical organisations, the only factor of appraisal is performance.

EMPLOYMENT ISSUES

Human resource managers face many dilemmas in hiring employees. One particular dilemma stems from the pressure of hiring one, who has been recommended by a friend or someone from the family of a top executive.

Another major dilemma arises due to employees who are later found to have fake documents. Both of the issues are critical. In the first case, the person may have been trained and filling the position is critical. In the second case, the person may be efficient in his work and have the right kind of attitude. Both the situations are tough and HR managers face such cases day in and day out.

PRIVACY ISSUES

All human beings working with any organization have their personal life. An employee needs the organization to directly or indirectly protect his/her personal life. This personal life includes things like the religious, political and social beliefs etc.

There are many ethical issues in HR that are related to health and safety, restructuring and layoffs and employee responsibilities. A debate is still going on whether some activities are ethically permitted and why some are not. Layoffs, for example, are not considered unethical as they were thought of in the past.

"I'd rather attempt to do something great and fail than to attempt to do nothing and succeed."

                                            ---- Robert H. Schuller

BUSINESS ETHICS - MORAL REASONING...

What is Morality?

In a broad sense, morality is a set of rules that shapes our behavior in various social situations. It is more sensitive doing the good instead of the bad, and therefore, it establishes a level of standard for virtuous conduct.

The Corporate Governance Code of Coca Cola

Coca Cola makes it clear that the company is inclined towards a good business morality. Its corporate governance code starts with these starting announcements.

“At the Coca-Cola Company, we aim to lead by example and to learn from experience. We set high standards for our people at all levels and strive to consistently meet them. We are guided by our established standards of corporate governance and ethics. We review our systems to ensure that, we achieve international best practices in terms of transparency and accountability. The foundation of our approach to corporate governance is laid out in our Corporate Governance Guidelines and in the charters of our Board of Directors’ committees.”

Where Does Morality Come From?

The principles of moral ethics can be injected into any business. Ethical businesses recognize the power of conducting businesses in socially responsible ways and they realize that doing so leads to increase in profits, customer satisfaction and decrease in employee turnover.

Business ethics is concerned with applying a moral framework to the way organizations do business. From dealing with human resources issues to sales and marketing policies, ethical viewpoints can shape and change the way businesses operate.

Business ethics has both normative and descriptive elements −

The normative part of business ethics has to do with understanding, how the behavior you and your employees exhibit in relation to cultural issues or social upbringing. The key to normative ethics for business owners is to understand how personal beliefs affect the choices made as a business owner.

The descriptive part of business ethics, on the other hand, is related to how you incorporate "best practices" into your organization's policies and procedures.

Henry Ford on Business Morality

“There is one rule for the industrialist and that is: make the best quality goods possible at the lowest cost possible, paying the highest wages possible.”

The Meaning of Moral "Justification"

"Justification" in terms of business ethics can be portrayed in two different ways. In business ethics, do the means justify the ends, or do the ends justify the means?

Is it better to have a set of rules telling you what you ought to do in a particular situation, or should one worry more about how things are going to end up and do anything to reach that goal?

Let’s take an example. John ran a medicine business in California, USA. His herbal product used to stop nausea and vomiting for chemo patients. California regulators had allowed his business entity, but federal agencies had not approved it. Therefore, selling it on national level was breaking the law. On the other hand, not selling could consign his clients to suffering. So, when federal agents came knocking on his door, he had to make a decision.

If the means justify the ends − If he follows the rules no matter what the consequences are, then the agents ask John directly whether he is selling the medicine and the ethical action would be to admit it.

If the ends justify the means − If your ethical interest focuses on the consequences of an act instead of what you actually do, then the ethics change. Therefore, when agents ask him whether he is selling, he has a reason to lie.

The Importance of Context

When we ask questions, such as "Which is more important, telling the truth or preventing harm?” often the context is more important. Context can be determined from factors such as time and place, the nature of the situation, other people's expectations, and the relevant history.

To understand the context, let’s assume you are a resident of Nazi Germany, in 1940. A family of Jews is hiding in your attic. The German police come searching that particular family of Jews. In such a case, preventing harm is clearly more important than telling the truth.

The Importance of Relationships

Business morality largely depends on business relationships. Our rights and obligations spring largely from relationships. These include our relationships with shareholders, customers, and general stakeholders.

These relationships can offer moral reasons for particular actions. For example, relationship with your shareholder means moral duties to them (such as to offer profits and be transparent) which you do not have for non-stakeholders.

Moral Questions are not Distinct

Moral problems are not a separate, special or particular domain to that is followed only on special occasions. Moral issues are present all the time. Most decisions that people make usually have a degree of moral importance. The challenge is in recognizing that fact. Morality is often finding the best choice overall, taking into consideration the result, economics, and technical (e.g., finances) appropriateness, and balancing them against other sorts of business values, which the organization follows.

Moral Decision Making

There is no crafted-out formula or algorithm for moral decision-making. Good moral decision-making includes knowledge of the facts, and careful consideration of the moral values (principles) relevant to a given situation. Importantly, sensitivity and awareness of the range of interests are also highly sought in moral decision-making process.

GETTING THE FACTS STRAIGHT

To make a good decision, we have to get the facts of the situation straight. In some difficult cases, additional facts may make the correct course of action apparent. These facts are available through science, or from the experiences of people who have studied the situation for a long time.

THE IMPORTANCE OF MORAL SENSITIVITY

Sensitivity to the moral issues involved in everyday activities is important for moral decision-making. Sometimes, we may take the help of instincts for taking trivial decisions. For example, most of us do not require an impetus to avoid lying in most cases.

For a problem with moral importance, the first and perhaps the most important step in resolving the problem lies in finding out the range of considerations. This includes an awareness of the parties going to be affected, sensitivity to the set of values or principles probably to be applied, and a sensitivity to the factors that influence the decision.

The Role of Discussion in Morality

If morality in business ethics is primarily about shared values, then business discussion, which can take many modes of communication with various parties, takes a central place in moral business-decision making. In many cases, more than one party may often be involved, and we should include others in our decision-making processes.

DISCUSSION AS A MEANS OF CONSENSUS-BUILDING

Discussion is important in moral business-decision making, as it is often important that others around us agree with or understand our decisions. For example, the consumer products industry often collects feedback through surveys and marketing gigs to take the business discussion forward.

DISCUSSION AS A WAY OF LEARNING FROM OTHERS

We can learn from discussing moral questions with others. Others can provide valuable insight or experience. For example, the software makers can have valuable feedback from users. That is why they beta test their products before launching a product.

GUIDE TO MORAL DECISION MAKING

There is no formula for making good medical diagnoses, or for giving good legal advice. All of these involve significant elements of experience and sensitivity.

Experience and sensitivity will not guarantee that a good decision is made, but they help assure that decisions are not hasty, or lacking in sufficient consideration of ranges of problems.

" I am blessed to have so many great things in my life - family, friends and God. All will be in my thoughts daily."

                                                         ----Lil' Kim

Dealing with Anger

People, by their own experience, know the unwelcoming effects of anger on their physical and emotional stability, and the unexpected consequences of them being angry in some situations. Still, some people find it hard to control their anger.

Dealing with Anger

PLAN BEFORE PREACHING

Before discussing anything sensitive topic or giving feedback, always be sure of the words that you use are appropriate and well-suited.

TALK TO ONE AT A TIME

Most people find receiving feedback in front of a group of people humiliating. They face too much embarrassment to focus on your message. Try to talk to one person at a time.

CHOOSE YOUR TIMING

Wait for a suitable time to provide feedback. Remember that feedbacks are given to help a person improve. He needs to be receptive at the time of conversation. Avoid giving feedback when he is stressed, worried, or tired.

TALK TO-THE-POINT

The person receiving the feedback must know which exact areas he needs to work on, so be precise in giving the feedback.

MENTION THE POSITIVES TOO

Techniques like the “Sandwich Feedback” where the feedback about negatives is sandwiched between two positive feedbacks ensure a person takes the feedback constructively.

STRENGTHEN THE RELATIONSHIP

Assure the person- in case he feels threatened while listening to the feedback- that irrespective of what the feedback is, you both will continue to share a cordial relationship. Learn to say ‘no’ where the other person gets persuasive.

  “Projections are just bullshit. They’re just guesses.”  

                           –Jason Fried, Founder, 37 Signals

Scales of Assertiveness...????

When people with different thoughts and sensibilities are put in some situation, they exhibit behavior that vary from one to another.

Let us observe four types of people and their different behaviors in those situations −

Scenario 1

Karan is a writer who likes to spend time with himself while writing. Every afternoon, his neighbor − who is a retired senior citizen − drops in for a casual chat. Karan doesn’t appreciate this daily intrusion on his privacy. How can he handle this situation?

Passive − ( this is so not happening right now) Hi Uncle! Come in.

Aggressive − ( time to put an end to this once and for all ) Look. This daily visiting has to stop. It’s difficult putting ideas on paper as it is, without you knocking at my door every single day

.

Passive-aggressive − ( and here comes the lonely loser… ) Oh, hi! You totally knocked me over with this surprise visit.

Assertive − ( he doesn’t know that I’m busy. How do I put it before him? ) As I was saying about that writing assignment of mine- it is challenging and demands a lot of imagination from me. I would appreciate if I could spend some time in the afternoon with myself. We could still meet on the weekends.

Scenario 2

Diya has been waiting in the queue of a subway inquiry post for the last 30 minutes to get the details of a particular train. Just when she is about to be attended to, a guy jumps the queue and requests her to let him put his query across. What would Diya do?

Passive − (yeah… treat me like the push-over I am) Hmm… okay.

Aggressive − (just who does this prince think he is!) Why do you think I was waiting? Because there were other people. You do the same; it won’t hurt.

Passive-aggressive − (why don’t I just offer you a cup of tea too) Oh, sure. I was just checking the weather.

Assertive − (he seems to be in a hurry but I have been waiting for long too) I have been waiting for quite some time too. I won’t take very long, I promise.

              “If you’re going through hell, keep going.” 

                                          –Winston Churchill, British Prime Minister

Defining Assertiveness.....?????

You need to consider the following four ways of behavior when it comes to assertiveness −

Four Ways of Behavior

THE PASSIVE WAY

People exhibiting passive behavior tend to the needs of others more than their own, as they think they are inferior to others. Passive people may not agree to what others say, but they usually follow others' decisions to avoid confrontation, blame, or responsibility. However, passive people suffer from self-esteem-related issues such as depression, as their needs are always overlooked.

THE AGGRESSIVE WAY

Aggressive people believe in standing up for their rights, even if it comes at the cost of jeopardizing the rights and hurting the feelings of other people. They believe in exerting their own rights, but not in equal rights. They usually get their own way by bullying, intimidating, or being pushy with others. Over a period of time, they suffer from isolation issues, as people are unlikely to stay affectionate with aggressive people for long.

PASSIVE-AGGRESSIVE WAY

People who exhibit this behavior do it to retain some order of freedom and independence in a strongly imposed-upon environment. This is an indirect way to express hostility by being irrational, unreasonable, and sullen. These people avoid speaking out their real feelings but reveal them in far more sarcastic and hurtful ways.

THE ASSERTIVE WAY

People who are assertive respect their rights, and those of others. They present their viewpoints firmly and confidently, but carefully choose their words to avoid hurting people's feelings and emotions. They know to control their anger and exhibit the most appropriate behavior in any given situation.

     “The secret to successful hiring is this: look for the people who want to change the world.”            

                                                –Marc Benioff, Salesforce CEO

What is Assertiveness....???

Assertiveness is the ability to express your thoughts and feelings, and to put forth your opinions − even if contradicting − in such a way that they clearly state your point of view while respecting others' feelings and opinions.

It makes you speak honestly and directly about your thoughts, feelings, and opinions without offending the listener(s), or hurting their sentiments.

It makes the other person more comfortable to have a conversation with you, as he feels that his opinion is also being given equal importance. This makes him more forthcoming and open to share his thoughts with you.

It makes you confident to exercise more control over your life in difficult situations, rather than blindly following instructions and directions of other people.

An assertive person would normally display the following traits −

Firm, yet pleasant voice

Clear speech and sincerity

Appropriate behavior at any given situation

Cooperative and progressive nature

 “It’s almost always harder to raise capital than you thought it would be, and it always takes longer. So plan for that.”

                  –Richard Harroch, Venture Capitalist and Author

Assertiveness Questionnaire

Given below is a list of scenarios. Try imagining yourself in them to see how comfortable you feel in each of the following situations.

Assertiveness Questionnaire

Do you wish to check your own assertiveness? Use this questionnaire by following these guidelines −

Read the scenario carefully.

Tick in one of the columns 1, 2, 3, or 4 according to your level of comfort given as follows −

1 − You are very uncomfortable

2 − You are slightly uncomfortable

3 − You are reasonably comfortable

4 − You are very comfortable

Tally the total ticks in the individual boxes.

If you get more than 5 ticks on 4, you are an assertive person!

DIFFICULT SCENARIOS 1234 You can speak up when you didn’t get the service you expected in a restaurant.When you are angry, you tend to express it.You can keep cool when a person criticizes you.You can speak in front of a group of people.You can tell a person to stop doing something that annoys or bothers you.You can request your friend unapologetically to return an item he borrowed.You can start a conversation with a stranger.You can return a defective item to the shop you bought it from.You can ask someone a favor of him.You can admit to ignorance on a particular topic.You can deal with opposing ideas and constructive criticism.You can say ‘no’ unapologetically to a request someone made to you.You express your feelings in front of a friend.You can argue with another person for your rights.You can refuse a friend a favor when you are not interested.

Download Practice-Sheet, to check How assertive you are?

  “I knew that if I failed I wouldn’t regret that, but I knew the one thing I might regret is not trying.”  

                                   –Jeff Bezos, Amazon Founder and CEO

ANGER MANAGEMENT TIPS...

ANGER MANAGEMENT TIPS...

Here are a few time-tested tips of anger management −

Thinking before Speaking − Collect your thoughts before saying anything.

Expressing Anger Calmly − State thoughts clearly without hurting others.

Exercising − Spend some time doing other enjoyable physical activities.

Timeouts − Some moments of silence can help you focus your thoughts.

Identifying Solutions − Instead of thinking what makes you angry, try to find a resolution to the issue.

Use 'I' statements − Say, "I’ve been waiting to check your presentation," instead of, "You never finish your work within deadlines."

Don't grudge − It's unrealistic to expect everyone to perform by your guidelines. Forgiving and forgetting can take a lot of negative emotion out of your system.

Use humor − Use humor to dissipate the situation without turning it hostile.

Practice relaxation skills − Practice deep-breathing, listening to music.

Seek help − Consider seeking professional help if your anger is absolutely uncontrollable.

Try it Yourself

Recall a situation that made you angry, and another one that caused you to turn violent in anger. Now compare both the situations and fill in the form.

What makes you angry? How would you react to this situation?

What behavior you want to avoid the most when you experience anger?

What will be your alternative line of action?

How will you deal with the early warning signs of anger?

How will you behave when you are very angry?

Download Try-it yourself sheet.

ANGRY BEHAVIORS....

ANGRY BEHAVIORS....

Analysis of Negative Emotions

Many think that anger is an emotion that just starts on its own and before they realize, it spirals out of control. On the contrary, anger is a defensive mechanism. It is invoked when we feel insecure so that it gets the body ready for the "Fight or Flight" mode of survival. Paying attention to the changes anger brings in our body can give us a hint of approaching anger.

Analysis of negative emotions include identifying thinking patterns that trigger and fuel anger. These include the following −

Clubbing Thoughts − For example, "Nobody cares about me.", "Why am I so invisible to others around me?", "They all hate me."

Forcing a rigid opinion − Having a non-negotiable view and opinion and forcing people to think identically when faced with opposite views.

Assuming and Concluding prematurely − For example, "I know what he is implying.", "Oh, so that's what he is getting at.", "Okay, maybe he doesn't want to hear me. Fine, we are done for good."

Building on anger − Looking for excuses to get angry and upset. This is both the cause and the result of irritation and brings in major misunderstanding between two people even if one of them is willing to help.

Blaming − You blame everyone else rather than taking a hard look at yourself to identify problems.

ANGER MYTHS AND FACTS....

ANGER MYTHS AND FACTS....

There are many widespread beliefs and myths regarding anger. Let’s deconstruct these myths and know what the facts are.

Myth 1 − Venting my anger out relaxes me. Holding it in isn't healthy.

Fact − There is a saying that holding on to anger is like holding on to red-hot coals in your palms. Anger should be drained out, but not by being aggressive. That will only lead to further confrontations.

Myth 2 − My aggressive behavior gets me attention, respect, and obedience.

Fact − Power to influence comes from understanding someone and not by intimidating him. You may bully people into submission, but they won’t respect you and will eventually desert you if you can't tolerate opposing viewpoints.

Myth 3 − I cannot control my anger.

Fact − Just like any other emotion, anger also is a result of the situation you are in. Analyzing the situation from multiple possible viewpoints avoids misjudgment and prevents anger.

Myth 4 − Anger management is about learning to suppress your anger.

Fact − Anger should neither be suppressed nor vented out, rather it should be expressed in a non-violent manner and in constructive ways. This is what Anger Management teaches people to do.

EFFECTIVE COMMUNICATION..

EFFECTIVE COMMUNICATION..

Communication is a way to make interaction between people. Entrepreneurs always try to improve their communication skills because it will assist them in sharing their ideas and presenting them clearly and to constantly work in a better way with their staff, team members, clients and colleagues. They understand the role of communication in entrepreneurship and they furnish themselves with some best tips to make their regular interactions effective.

Having good communication skills will also help an entrepreneur at the time of project explanation, elevator pitches, presentation, training as well as many other areas where a person has face-a-face talk with people. An effective communicable person can build his career easily.

The basic steps of communication are −

The forming of communicative intent to make a healthy relationship.

Message composition to make a healthy dialogue between two participants.

Message encoding to hide your personal or confidential thoughts in a message.

Transmit encoded messages in a sequence of signals using specific channels.

Checking reception of signals to ensure the that they are active in communication.

Reconstruction of the original message and acknowledge on a particular chat.

Interpretation of previous messages and making a sensible reconstruction.

Presentation Skills for Entrepreneurs

Presentation is a way to represent your idea through pictures, but it needs excellent communication skills too. Effective presentation can help your business in growth. Once you explain everything digitally in a conference hall, everyone likes your product.

A few steps which you should follow for convincing your target audiences are as follows −

Step 1 − Before proceeding to the presentation, you should clear your objective in advance. During a presentation, you can try to focus to a specific topic, so the users are impressed with it and understand your key motive and take a decision.

Step 2 − Practice your point of view in advance, so that you can be prepared for the target audience at the time of the presentation. It is a big challenge to impress everyone, but when you know the people, then you can give presentation as per their guidelines.

Step 3 − Self-confidence is the key to getting success; it means you must know your positive points and limitations so that while presenting, you should use your qualities and try to hide your weaknesses, so they don’t affect your presentation.

Before going for any idea, an entrepreneur must now how to properly create a time schedule under which you can present everything with your effective communication skills. If he learns how to deliver knowledge, guidance and performance all at the same time, then he becomes someone to watch out for.

Previously, people used to create a script as per which they would present their ideas to people. Nowadays, businesses have started opening over a cup of tea. Ideas can come from anywhere. A real entrepreneur knows the target audience even before the idea has been germinated properly.

CREATING A PRODUCTIVITY JOURNAL...

CREATING A PRODUCTIVITY JOURNAL...

It is always a good idea to keep a track of how much money you have spent and the time spent towards your goal, as this will help you analyze how productive you are. This will also help you examine and adjust your priorities and have a clear mindset towards your goals.

Having a productivity journal is just like having a time log, you can also use a spreadsheet to create one. Your journal should include three things, which are −

Activities,

Time spent on each activity, and

The progress or the outcome of the activity.

You must maintain all the three sections honestly.

The Urgent Vs Important Matrix

Sometimes we are busy handling things which tend to be important, but are not actually that important. The best example of this situation is the distracted zone. These tasks may seem important for people around, but they don’t help you to meet your goals.

Urgent and Important − As the name suggests the tasks in this section demand urgent attention, it includes handling critical issues as soon as they arise in the first place.

Important, but Not Urgent − This section includes success-oriented tasks which are important for achieving your goal, but they do not demand immediate attention.

Urgent, but Not Important − This section includes tasks which needs to be done urgently, but are not that important. These tasks don’t help you to take your goals forward. You can try delaying them or postponing them for some time or even finish them in your leisure time.

Not Urgent and Not Important − The tasks which are neither urgent nor important and are not even related to your goals are composed in this section. These can be considered as just some distractions you get in your way. None of your family and friends are labeled in this category. The things which are not important like playing games for hours are labeled in this section.

The 80/20 Rule

The 80/20 rule states that 80 percent of our success comes from only 20 percent of our actions. In simple words, it is important to focus more on the 20 percent which demands the actions to de-bone for the 80% success. Plan, prioritize and start working on the 20%.

The Glass Jar: Rocks, Pebbles, Sand and Water

This method of “rocks in a glass jar demonstration” is like the time management techniques which are used to demonstrate the importance of having all your priorities set. In this method, a glass jar is first filled with large rocks and then with pebbles.

After pebbles, the jar is filled with sand and water. The main objective of this exercise is to teach the participants that they have to put large rocks first, else it won’t fit later. The large rocks represent different goals which we need to prioritize in our lives to achieve.