Organisation's purpose shaped by vision, leadership and ethics
Introduction
The corporate strategy is only a means to the
purpose of the organisation. It is impossible to develop strategy if the
purpose remains unclear and purpose remains unique to each organisation. The
definition of purpose is complex and multifaceted; Michael Porter simplified
the term purpose as ‘profit maximisation’ while Professor Oliver Williamson
defined purpose as ‘survival’.
Shaping of
the purpose of the organisation
The complexity of developing purpose is
overcome by shaping the purpose of the organisation which is a process by
identifying and concentrating on essentials on the organisation. The shaping of
the purpose of the organisation involves examination of strategic vision, roles
of leadership and ethical considerations.
Purpose
shaped by ethical considerations
The ethical considerations are standards and
conduct that the organisation sets itself in its dealing within the
organisation and outside with its environment.
Ethical issues: 4 prime considerations in the ethical conduct
of organisations
The ethical issues are to identify what is
morally correct behaviour for the organisation. There are 4 main reasons for
considering the ethical conduct of organisations.
1)
In every society, such considerations are
sometimes inescapable. For example, legal limits on conduct.
2)
They may be important to conduct in that society.
For example, respect for ‘green issues’ in the environment that go beyond legal
limits.
3)
A consideration of ethics is part of the
professionalism of business. For example, the treatment of workers and ethics
groups.
4)
The self-interest of organisations is often
best served by developing attitudes to ethical issues before they come acute.
For example, bad publicity as a result of accusations of incorrect behaviour.
Types of
issues in developing business ethics
They are 3 basic areas that need to be
explored in the context of purpose and strategy development which are:
1)
The extent
of ethical considerations
It states
the extent of organisation to consider the ethical issues that could arise in
its conduct of business beyond legal minimum. It may involve in every area or
lay down some basic principles and the leave parts or individuals to conduct
themselves appropriately.
2)
The cost
of such considerations
Some
actions will have a cost to the organisation and many of the real conflicts
arise here because if they were without cost then they would be easily
undertaken. There are no abstract rules but each organisation will need to
consider this area.
3)
The
recipient of responsibility
It
concerns the organisation’s responsibility to the state, local community or individual.
For example, McDonalds’ continuous efforts in children welfare through raising
funds.
Ethical
issues that might impact on purpose
1)
Espionage
The sources that company acquire from to find
out about competition and the reasonable enquiry finish and aggressive search
for additional data.
2)
Tyrannical
regimes
The ethical issues arise whether companies
selling products a country that is run by tyrannical regimes is justified.
3) Bribery and corruption
The line is undefined whether organisations should
engage in such activity in every circumstance so that jobs may be saved and contracts
won for only limited sums to all number of people.
4) Telling half-truths and operating misleading negotiation tactics.
The truth is not presented fully and might
mislead into negotiating tactics. For example, unethical financial planners may
hide some hidden clauses of the particular financial product which will affect
their closing of customers, customers sees it lucrative and decides to buy.
Ethical
considerations and corporate strategy
Ethical considerations may influence
corporate strategy at a number of levels. The values of the organisation will
need to be reflected in its purpose and mission statements. Such matters may
reflect the role that the organisation sees itself playing in society and the
responsibilities.
1)
The
national and international level
The role
of the organisation in society and the country.
Political,
economic and social issues will impact.
Laissez
faire vs. Dirigiste.
The role
and power of trade blocks and closer economic union.
The
organisation is entitled to have a view on these matters and seek to influence
society.
2)
The
corporate level
Ethical
and corporate issues over which the organisation has some direct control. Such
matters as the preservation of the environment, contributions to political
parties, and representations to the country’s legislative parliament are all
examples of direct corporate activities that need to be resolved.
3)
The
individual manager and employee level
The
standards of behaviour which the organisations wish to set for individual
managers and workers. Some of these matters may not be strategic in nature in
the sense that they are unlikely to affect the future direction of the
organisation overall but rather the future of individuals. However, there may
be some general policies on, for example, religion, ethnic and equality issues
that involve both the individual and fundamental matters relating to the
direction of the organisation. These general matters of policy deserve to be
treated at the highest possible level and therefore come within ambit of
corporate strategy.
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