QUALITY MANAGEMENT, ETHICS, AND CORPORATE SOCIAL RESPONSIBILITY

Definition and Overview of Ethics

• Ethics are the rules, expectations, and guidelines that guide a person or group's behavior. The term
"behavior" is crucial in this definition.
• If management places a strong emphasis on behavior, ethics become a byproduct of effective
management. Through ethics codes, training initiatives, and other channels of communication,
leaders make clear what behavior is suitable and unacceptable to their workforce.
• Contrarily, ethical business conduct is described as "behavior that is consistent with the principles,
norms, and standards of business practice that have been agreed upon by the society."
• It entails acting morally and doing what is right.
• Stevenson (2015) identifies five (5) principles for thinking ethically:
o Utilitarian PrincipleIt says that the benefits of an action should outweigh any potential negative
effects.
o Rights Principle. According to this, one's conduct should respect and defend the moral rights of
others.
o Fairness Principle. It states that equality should prevail in all circumstances.
o Common Good Principle. It states that actions should benefit the overall well-being of the
community.
o Virtue Principle. It specifies that actions should be in accordance with certain ideal virtues.

Trust, Values, Integrity, and Responsibility

• Trust. It relates to the trust that a dependable and honest individual has earned. Trust develops
when people believe you have honest intentions and are a reliable source. Communication,
interpersonal relationships, conflict management, problem resolution, teamwork, employee
involvement and empowerment, and customer focus are some of the different aspects of
comprehensive excellence that depend on trust.
• Values. It relates to a person's profoundly held views, which make up the fundamental essence of
that specific person. Fairness, reliability, integrity, honesty, and truthfulness are among the values
that guide ethical action. These principles frequently promote an office atmosphere that engages,
empowers, values, and cares for its employees.
• Integrity. It illustrates a person's capacity for moral integrity and honesty. People with integrity can
be relied upon to act morally, conduct themselves properly, perform duties entirely and on time,
and maintain their word in a total quality workplace.
• Responsibility. It has to do with a person's responsibility to accept responsibility for their conduct.
Taking ownership of one's actions contributes to the development of trust, honesty, and all the
other ethical components necessary for a culture of comprehensive quality.

The Importance of Ethics in Businesses

The importance of ethics can arise from the following:
• As a result of globalization, technical improvements, and sustainability concerns, business ethics
challenges have grown more complex.
• Ethical challenges are frequently business opportunities or can be converted into business
opportunities.
• The cultural and legal demands for the business are also rising.
• By conducting their operations morally and legally, companies can avoid costly lawsuits,
settlements, and thievery.
• Lack of ethical behavior results in strained relationships between group members, harm to the
organization's reputation, a decline in employee engagement and productivity, uninspired work,
and absenteeism.
• Businesses that are known for acting unethically and cruelly toward their workers have a hard
time attracting and keeping talented employees.
• Strong integrity and strong ethical leadership go hand in hand.
• Companies that behave ethically and socially responsibly benefit both the general public and
their customers.
• Investor loyalty, consumer satisfaction, corporate success, and earnings are all enhanced by
ethical businesses.
Manager’s Role in Ethics
The role of managers in establishing an ethical work setting consists of three (3) approaches.
• Best-Ratio Approach. It is predicated on the idea that everyone is decent. People will act morally
when the conditions are correct and will be motivated to act unethically when certain conditions
are there. The finest feasible balance of moral behavior to immoral activity should be maintained
by managers, who should also encourage moral behavior. Managers should choose the option that
will benefit the greatest number of people when faced with difficult choices.
• Black-and-White Approach. It is founded on the certainty that what is right is right, what is wrong
is wrong, and that circumstances are irrelevant. The manager's job is to make ethical decisions and
see that they are carried out in order to help employees behave ethically regardless of the
circumstances. When making difficult decisions, managers should make fair and impartial decisions
regardless of the outcome and do the right thing regardless of the short-term circumstances.
• Full-Potential Approach. It is predicated on the idea that individuals are in charge of reaching
their greatest potential within the bounds of morality. Managers should base decisions on how
they will affect the ability of everyone involved to reach their full potential whenever a choice
needs to be made.
Organization’s Role in Ethics
The organization’s responsibilities are to: (1) create an ethical environment in which stakeholders
know that they will be supported when making ethical choices and (2) ensure that all people in
positions of authority in the organization set an example of living up to the highest ethical
standards.
• Creating an Ethical Environment. By adopting and upholding policies and procedures that
guarantee all employees are treated ethically, a firm can create a moral workplace. Managers
must create an ethics philosophy with clear rules that will act as an ethical benchmark within
the company.
• Setting an Example. A company that approaches ethics with a "Do as I say, not as I do"
mentality will fail. To gain the trust of their staff, managers must act or conduct in accordance
with the organization's ethical standards.
Models for Making Ethical Decisions
The following are the most widely used models for making ethical decisions:
• Full-disclosure Model. This model relates to the organization's capacity to articulate its actions
in a way that satisfies a wide range of stakeholders. This implies that management choices must
consider the interests of the greatest number of people.
• Doctrine of the Mean Model. The average or midpoint between two (2) extremes is referred to
in this approach as the mean. This suggests that a reasonable middle-ground alternative is
probably an ethical option in any circumstance. To put it another way, this concept implies that
moderation is moral.
• Golden Rule Model. The Golden Rule—"Do unto others as you would have them do unto
you"—is the foundation of this philosophy.
• Market Ethics Model. The foundation for this is the idea that any legal conduct that advances
financial success is moral. The goal of a firm, according to this model's proponents, should be to
turn a profit. As a result, morality should be judged from a perspective of gain and loss.
• Organizational Ethics Model. Loyalty to the organization is the foundation of this model. Its
fundamental tenet is that the action that best advances the objectives of the organization is the
most moral one.
• Equal Freedom Model. This implies that organizations are allowed to act however they like so
long as they respect the rights of stakeholders.
• Proportionality Ethics Model. This approach is predicated on the idea that because of how
complicated the world is, there aren't many situations in which decisions can be made with
certainty. The most a company can do, then, is to make sure that when making judgments, the
good exceeds the bad.
• Professional Ethics Model. Peer review is the foundation for this. It states that a choice is moral
if it can be justified and get the support of a wide range of professional peers.
Beliefs vs. Behavior
The following are the several reasons that explain the disparity between the belief and behavior of the
people:
• Self-interest and Self-protection. People are naturally self-interested and protective of their
own interests. Most people struggle against human nature when they prioritize another
 person's demands over their own. But in order to conduct business ethically with coworkers
and the general public, one must do just this.
EXAMPLE: Juni lied about forgetting the excel sheet required for the process review in order to
avoid receiving a reprimand from their management.
• Conflicting Values. People who adhere to ethical principles (such as honesty, loyalty, justice,
etc.) may find themselves in circumstances where these principles appear to be at odds.
EXAMPLE: Mariam is unsure about whether she should be honest with the client about her
inability to complete the housing project by the deadline or show her commitment to the
business by assuring the client that the project will be completed in the timeframe they have
specified.
• Tangible or Intangible, Immediate or Deferred. Because the apparent benefits of immoral
decisions are generally regarded as both concrete and immediate, while the benefits of ethical
judgments are frequently intangible or delayed, people frequently make decisions that go
against their convictions.
EXAMPLE: Mariam made the decision to be true to the business and assured the client that they
would be able to complete the housing project within the allotted time because her company
would secure a crucial contract, which she would have been responsible for. The disadvantage
is that eventually the business will lose the contractor she deceived's trust and, most likely,
their future business.
• Making Ethics Tangible and Immediate. Even those who hold ethical ideals can sometimes
chose the unethical course of action because they believe that the rewards of doing so are
ethereal and distant. Management in a particular circumstance expects ethical behavior but
does not reward it or, even worse, unwittingly supports unethical behavior.
EXAMPLE: Instead of Mariam making the right choice, the senior management may have
encouraged the supervisor to act unethically.

Creating an Ethical Work Environment

An ethical workplace is necessary to build an ethical corporation. Businesses undertake a variety of
projects. Creating formal positions, disclosure procedures, ongoing training programs, enhancing
communication, and developing an ethics code are a few of them.
• Establishing a Formal Position. An individual position may be given responsibility for upholding
moral principles by management. This not only devotes organizational resources and time to the
issue, but it also serves as a reminder to every one of the value of ethics. One illustration is an ethics
committee, a cross-functional team of executives responsible for managing company ethics. The
chief ethics officer of certain large businesses, on the other hand, oversees the establishment of
ethics departments that administer and coordinate all corporate ethical initiatives. Small and
medium-sized businesses can designate one of their senior managers to oversee ethical concerns.
• Creating Disclosure Mechanisms. Another crucial tool for employees to express concerns about
unethical conduct is a confidential hotline. Individuals who are willing to speak up if they suspect
unlawful, harmful, or immoral behavior are essential to holding institutions accountable (i.e.,
whistleblowers).
• Organizing Regular Training Programs. To raise ethical awareness and to enlighten employees on
ethical issues, suitable acts and behaviors, the organization's ethical rules, etc., several organizations
set up training programs.
• Improving Communication. A company's ethical principles must be repeatedly and in a variety of
ways communicated. It is insufficient to only distribute a single memo.
• Preparing a Code of Ethics. To establish and maintain an environment where moral behavior
flourishes, adherence to ethical rules is crucial.
An Exemplary Code of Ethics Focused on Quality
To implement ethical behavior, corporate organizations should have a code of ethics that is centered
on quality issues. The statements about people that can be utilized as ethical norms with a quality
focus are indicated by the seven principles listed below:
o Adopt the new philosophy, which promotes excellent and efficient training and
guarantees efficient monitoring.
o Institute training on the job.
o Adopt and institute leadership.
o Drive out fear.
o Break down barriers between staff areas.
 o Eliminate numerical quotas for the workforce and numerical goals for management.
o Remove barriers that rob people of pride in workmanship and eliminate the annual
rating or merit system.
The following is an exemplary code of ethics developed by Stimson (2005) based on Deming’s
principles:
 Meeting customer expectations
 Honesty
 Non-delegable quality
 Traceability, which reduces occasions for waste and fraud
 Respect for privacy and avoidance of conflicts of interest
 Antidiscrimination
 Empowerment through organizational freedom, responsibility, and authority
 True reports
 Integrity

References:

Heizer, J., Render, B., & Munson, C. (2017). Operations management: Sustainability and supply chain management (12th ed.). Boston: Pearson Education, Inc.

Quality Management - Chapter 2: Quality Management, ethics, and Corporate Social Responsibility özeti: AOF.SORULAR.NET. (n.d.). Retrieved January 22, 2023, from

https://aof.sorular.net/ozet/quality-management-cmH-chapter-2-quality-management-ethics-and-corporate-social-responsibility

Stevenson, J. (2015). Operations management: Twelfth edition. New York: McGraw-Hill Education