Creating an Ethical Organizational and Customers Responsive Culture

The content and strength of a culture influence an organization’s ethical climate, and the ethical behavior of its members. An organizational culture most likely to shape high ethical standards is one that’s high in risk tolerance, low to moderate in aggressiveness and focuses on remains as well as outcomes. Managers in such a culture are supported of taking risks and innovating are discouraged from engaging in unbridled competition, and will pay attention to how goals are achieved as well as to what goals are achieved.

A strong organizational culture will exert more influence on employees than a weak one. If the culture is strong and supports high ethical standards, it should have a very powerful and positive influence on employee behavior Johnson & Johnson for example has a strong culture that has long stressed corporate obligations to customers employees the community and shareholders in that order. When poisoned Tylenol (a Johnson &Johnson product) was found on store shelves, employees at Johnson & Johnson across the United States independently pulled this product from these stores before management have even issued statements concerning the tamperings. No one had to tell these individuals what was morally right: they knew what Johnson & Johnson pushing the limits can be a powerful force in shaping unethical behavior. For instance: Enron’s aggressive culture with unrelenting pressure on executives to rapidly expand earnings, encourages ethical corner-cutting and eventually contributed to the company’s collapse.

What can management do to create a more ethical culture? We suggest a combination of the following practice:

Be a visible role model: Employees will look to top management behavior as a benchmark for defining appropriate behavior. When senior management is seen as taking the ethical high road, it provides a positive message for all employees.

Communicates ethical expectations:
Ethical ambiguities can be minimized by creating and disseminating an organizational code of ethics. It should state the organization’s primary value and the ethical rules that employees are expected to follow.

Provide ethical training: Set up seminars, workshops, and similar ethical training programs. Use these training sessions to reinforce the organization’s standards of conduct to clarify what practices are and are not permissible, and to address possible ethical dilemmas.

Visibly reward ethical acts and punish unethical ones: Performance appraisals of managers should clued a point-buy-point evaluation of how his or her decisions measure up against the organizations code off ethics. Appraisals must include the means taken to achieve goals as well as the ends themselves. People who act ethically should be visibly rewarded for their behavior. Just as importantly unethical acts should be conspicuously punished.

Provide protective mechanisms: The needs to provide formal mechanism so that employees can discuss ethical dilemmas and report unethical behavior without fear of reprimand. This might include creation of ethical counselors, ombudsmen or ethical officers.

There are certain variables that shape customer responsive cultures and offer some suggestions that management can follow or creating such cultures, but those are not outlined here because they are beyond the scope of this article.

French retailers have a well established reputation for indifference to customer. Sales people for instance routinely make it clear to customers that their phone conversation should not be interrupted. Just getting any help at all from a salesperson can be a challenge. And no one in France finds it particularly surprising that the owner of a Paris store should complain that he was unable to work on his books all morning because he kept being bothered by customers.

Most organizations today are trying very hard to be un-French-like. They are attempting to create a customer-responsive culture because they recognize that is the path to customer loyalty and long term, profitability. Companies that have created such cultures – like Southwest Airlines, FedEx, Johnson & Johnson, Nordstrom, Olive Garden, Walt Disney theme parks, Enterprises Rent A Car, Whole Foods, and L L Bean—have built a strong and loyal customer base and have generally out performed their competitors in revenue growth and financial performance.