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I:thicalDilemma
,-liNG IN BUSINESS
vou think it's ever okay to lie? If you were negotiating the release of hostages, most people wotHd probably ee that if lying would lead to the hostages' safety, it's '. What about in business, where the stakes are rarely or death? Business executives such as Martha Stewart e gone to jail for lying (submitting a false statement to eral investigators). Is misrepresehtation or omitting fac'"'> kay as long as there is no outright lie? o Consider the negotiation process. A good negotiator er shows all his cards, right? And so ornittihg cettaininnation is just part of the process~WeU, it may surprise -.to learn that the law will hold you liable for omitting mnation if partial disclosure is misleadihg or if one side on the grounds that. it should have disclosed this information to him, Duff and Phelps countered that it had never lied to Jordan. The Court of Appeals argued that in such situations, one party cannot take "opportunistic advantage" Of the other. In the eyes of the law, sometimes omitting releva~1tfacts can be as bad as lying. Questions L In a bllsinesscontext, is it ever okay to lie? Jfyes, what are those situations? Why is it okay to lie in these situations? 2. A recent survey revealed that 24 percent of managers said they have fired someone for lying. Do you think it's fair to fire an employee who lies, 1.10 matter what the nature of the lie? Explain. 3. In b\,\siness, is withholding information for your own advantage the same as lying? "'Thy or why not? 4. In ab\lsinesscontext, if someone has something to gain by lying, what percentage of people, do you think"w{}uld lie?

" superior information

not accessible

to the other.

Tnone case (Jordan v. Duff and PhelPs),a company (Duff , Phelps) withheld information from an employee "dan) about the impending sale of the company. The ,blem: Jordan 'was leaving the organization and theree sold his shares in the cornpany. Ten days later, when sale of the company became public, tboseshares beJCworth much more. Jordan sued his former ern1/lo'ter
~

rces:Based on "Lying at Work Could Get You FiJ,'ed,"UPI,MaJ,'ch5, gOO6; Brain S<;ans " Detect More Activityin Those Who Lie," "tel'S, November 29,2004; and P. Ekman and E. L. Rosenberg,. Whatthe.Fcr(tRev(lals;Bsi{iandApplied Studies of SpontaneousExpression "g thefacial Action Coding System (CA.PS),2nd ed. (New York: Oxford U;niversity Press., 2004).

~ase Incident

1rn.oreinformation sharing, and hard metrics. "You can't manage a secret/~ he is also fond of saying. It's not yet clear whet,fierMulalIy's approach explains why Ford weathered

DATA WILL SET YOUFREE"

r'd CEO Alan Mulany is known for.starting !11ee~ingsby mg "Data ,viII set you free" and for trying toclIange -d's culture to one based on increased acc()untability,

,~.

the recession in bett~f. shflP~ t1;Ianits lJ$.rl'ials BManCl Chrysler. Howevet,.Mplalli$.flPpr<~ac1;Iis~cl.eparture for Ford, which was noto}5ot(s for.its$elf~ontaihe9fiefdoms where little jnformation was spared. SOIIle q:nnpfimes have found that mana,.gillgpeoplea~cordingto lJ,arclII1etricshas paidoff.ConsiderF:r~es~!ile SeIIli~oJ;1dw:tor, a computer chip manufacturetl?as~<;l in ';\l.lstii:1, e~as. T Freescale has discovered that it! o:rde:rto ..1Iave. right the people at the right time to dotherightJPP. itneedsan extensive and elat>orateset of mettlcs tomarrflge 24,000 employees in 30 counhies.Ofpahicular cONcern to Freescale is retention. "There's nogcreat~r6osttijan htimaiI capital, especially in the tech.n01ugy indtistry," saysJignashii Patel, Freescale's director of global wentsQurcing and indusion. "When you've got a tenuregemployee thatde~idesto walk out the door, ifsnotjl.lstol1ep~rsoh leaving, it's that person's knowledg~ an.d ne~vork and skills." To manage talent and preventtl.lrhover, Freescaleholds line managers accountable forrecruhillg, pirillg,;llld tetaining employees. To do thatimaria,gersneed to project their talent needs into the future and reconcile those with projected availabilities. Patelptovides linemaaagers Yvith Census data that help them make their projecticms, but at the end of the day the responsipllitY is theirs, "v\'hat we have done is taken aUof our indusion data, <111 metrics, our

;li:1dwfve I1'loyedthe accountabilitY over to the unite fatel 8~ys. pateI al~9 provides Fre.escale managers \\lith bene data.~Q tPt;y .can.compare their effectiveness wit1, other units., 1'hehench1114rk data include the n.. pepple hired, tUrnove:rs, and promotions-am! dmNns by demogcraphic catego):'ies. "There's- [a re!.. investment] for everything we do," says Patel. Questions I. ~'PY..cloYPl.lthinkFree.scalefocuses on metrics? don't mOHtorgani~<il.tions foUowits approach; 2. As a manager, would you want to be accountah the acquisitionatid retention .of employees yoc, Vise?Why ohvhy hot? 3. In gener:al, what do ypu think are the advant"'6 limitations of such metrics? 4. Freescale focused on .metrics for the acquisitiOt. r~tentionof ernPloyees. Do you think me tries applied to other areas of management, such as ployee attitUdes, employee performance, or sk velopment? How mighttb.ase metrics be meas!' arid mah~ed?

SOUT(;es: Based an R. R. Hastings, "M~trics I.hive WinningC'ldtnre," SHRlvf Online, ApnJ9., 2007, ww\V.shrm.org; K. Bensinger: Loss Sparks Optimism," Los Ange(esTimes (Aprit24,2009); T.Talllkdar at1d A. Ghosh, "IT Conipimies Growon to Bigger-Sized P, Th!:EconomicTimes (June 16,200$), econOl:nictimesoindiatimes.com.

Case Incident 2
THE GLOBAL RECESSION AND WORKPLACE MALFEASANCE
The great global recession has claimed many victims. In many countries, unemployment is at near-historic highs, and even those who have managed to keep theirjobs have been asked to accept reduced Work houts or pay cuts. In some cases-say, the U.S. auto indnstty-jop losses pave been predictable but no less painfuL However, i.n ather cases, they have corne as a surprise. Nonn Elrod had earned an MBA while employed a.t an online marketing firm. His degree didn't save his job--Elrod was laid off.in October 2008 and, as of April 2009, he was unemployed and still looking for work. "There's a lotoffrustration out there," Elrod said. The financial and psychological pain caused by the recession may lead you to wonder whether employees attempt to get even. Is t}lere e\idence the recession has led to increased incidents of workplace violence, sabotage, or theft? As it turns out,.this jsa very diJIi.ctJltquestion to answerwith any confidence. The diJIi.cpltYillustrateshow OB can teach you how to think critically about problems an? analyie them carefully. DUling any recession, there is no lack of reports on.J:h calami tOllSeffects qf the do\\7nturn. The Times of LonG,to\ reported that U.S. job losses Were directly linked to 5R fac ~ talities in eight incidents dUling one month in 200~i, "I Among them WaSa Vietnamese man fired from his factor') job who killed 13 people at an immigration center i! Binghamton, New York. It's not just displaced-worker violence that is gcttinp headlii1es. Among nearly 400 emplayees asked in latc 200? whether the recessian had cal1sed a reCent rise in thefts oJ money among employees, 18 percent said yes, 41 percent said no, and 41 percent were ilnsure. Though this poll sug- ~ .. . .. ~ gests only a small mlnonty of employers thought the reces- ..~ sian had led to a1'l. ncrease in employee theft, the media,! i reported the qpposite res4lt. The Wall Stref;!t Journal ran the m headline "Businesses Say Theft by Their Workers Is Up." It' ..

"""Joney, under the headline "Businesses See Rise in mpJoyec Theft," l'eponed thepoHresultS as follows: \'hen asked if they had noticed a recent lise in monetary ,.n among employees, such as fraudulent transactions or lissing cash, 18% said yes, 41% were unsure and the rest ;aid they hadn't." You'll notice that, put another way, Kpercent agree that theft is up, and 82 percent either disg-reeor are unsure. But that makes for a less sexy headline. Another mischief factor is companies that exist to prO" ide services, software, and technology to deter workplace pft. \o\11iJe they might provide a valuable service to.the organizations they serve, it is in their interest for employers nd the general public to believeincidencesofwork.place 0lence and theft are increasing. These companies often 'Jroduce press releases, which then work their way into the nedia and presumably generate potential clients for the rganizations. One such company, for examPle, publicizes study of work.place theft, reporting it has increased each nd every year since 2003. We are not arguing that all business press articles-or all udies done by organizations-are inaccurate. But these xamples do ilJustrate one of the benefits of lean;ling OB:

Put on your investigator hat, ask questions, analyze the situatiQrl, and consider the sO\1rce! Questions 1. Does this caSe prove economic downturns and companylayof(sJaiftoleadtoworkp lace malfeasa.nce? Why 0):'why not? 2. Qoes the case provcwe can learn nothing from the busincsspress? 3. Does this chapter provide any clues for how you can be an informed. consumer of business news on OB iS$ues? 4. Some companies in.stall surveillance equipment (cameras,computer software) to monitor their employees. Valenti Management, which owns and runs 117 Wendy's and 17 Chili's restaurantS, has installed fingerprint scanners on all its cash registers. Do you think these measures infringe too much on individua.l pfivacy?Qan a company tak' prevention too far? How.do you strike a balance between prevention and intrusion?

)ources:Based on J. Bone, "Gunman Kills 13 and Takes 4Q Hostage in Upstate New York Town," The Times (April 4, 2009), http:// www;timesonline.co.uk/tol/news/wodd/us_and_americas/artic1e6031421.ece; .S. E. b,jeedlema.n, "Businesses Say Theft by Tl1eir Workers Is Up," WallStreetJournal (December n,2008), p.B8; M. C6nliri, "Tocatch aCorpoTate TRief," Business Week(February 16, 2009), p. 52: P. McGeehan, "Well Educated, and Now Collecting Unemployment," New.YorkTimes (Apri15, 2009), p. Y23; and "Businesses 'iee Rise in Employee Theft," MSN Money (December 12, 2008), articles.moneycentral.msn.com/lnvesting/Extra/businesses-sec-risen-emplolycc-tJleft.aspx.

Endnotes
6. I. E. Saner, "The Future Is Looking Up for Psychics," The Guardian (May 5,2009), p. 2;S. Salerno, "If I Don't See It, It's Not There," Wall StreetJournal (May 1, 2009), p. WI3; R. La Feria, "Love, Jobs & 401 (k)s," New York Times (November 21, 2008), pp. ST1, 8-9; S. Parke, "Cashing in on the Crunch: The Self-Help Gurus Helping Themselves tc) Your Money," Mail Online (Aptil.23, 2009) ;and R Banerjee, "Astrologers Cash in on Recession Fears," The Times of India (March 10, 2009), http://timesofindia,indiatimes.comj city/ de llli/ AstroI6gers-cash-in-on-recession-fea.rs- hrticleshow /424 7920.cms#ixzz141FbKpIX, 2. Cited in R Alsop, "Playing Well with Others," Wall Street journal, September 9,2002. 3. See, for instance, C. Penttila, "Hiring Hardships," Fntrep'reneur, ctober 2002, pp. 34-35. O 4. S. E. Humphrey, J. D. Nahrgang, andF. P. Morgeson, "Integrating Motivatiopa,l, Sodal, aTlqGontextua,1 Work, Design Features: A Meta-Analytic Summary and Theoretical Extension of the Work Design Ut~rature," Journal of Applied Psychology po. 5 (2007), pp. 1332~1356. 92, 5. 1. S. Fulmer, B. Gerhart, a)1d K S..Scott, ".i\re the,JOOBest Better? An Empirical Investigation of the Relationship Between Being a 'Great Place to Work' and Finn 7.

8. 9.

Perfonnanee," Personnel Psychology, Wimer 2003, fip .965'-993. H. Fayol, Industrial and GeneralAdministration (Paris: Dunod, 1916). A..I. Rraut, P. R Pedigo,.. McKenna, and M. D. Dunnette, "Tbe~ole of the Manager: "''hat's Really Important in Different Management Jobs," Academy of Management .xecutive19, no. 4 (2005), pp. 122-129. H,JvliJ:i.tZb.et;g, 1'l~NaluTf!qf.tv1anageri(ll Work (Upper Saddle RJ.ver,NJ: Prentke Hall, 1973). R. L.KatZ, "SkH1sof an Effective Administrator," Harvard ]3'tfSint;$s l}Jwi.l!'pJ., SepteJ.Flber-Octobe.r 1974, pp. 90-102; .Barttah1,"Th~ <;reatEight Competencies: A CriterionCentric Approach to Validation," Journal of ApPlied Psychology 90, 00.6 (~OO5), pp. 1185-1203; and S. E. S(:uUen, M;.K.Mount, and T. A. Judge, "Evidence of the COI1strMt Validity of Development a] Ratings of Managerial Performance;" JOurnal ofApplied Psychology88, no. 1 (2003).
pp. 5{}..;66.

l(kF,I4t1t:1:1.~s.;'\Suceessfulvs. Effective Real. Managers," Academy ofMa'i}agt!J~1 Executive, May 19$8, pp. 127-]32; and ELuthans, RM. Hodgetts, and S. A. Rosenkrantz, & Managers (Cantbridge, MA: Ballinger, 1988). See a,s' F.$1:tiPBer;~nd;J.Davy, 'fA. Model and Investigation 'Managerial Skills, Employ~es' Attitudes, and Mana!:;. Performa.nce," Leadership Quarterl)'13 (2002), pp. 9"-12

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