Sales management and ethics
It is over and over again business people often asked whether ‘sales ethics is an oxymoron? ’ The need to understanding ethical decision and put it into practice in today business world is much more complicated compared with few decades ago. Likewise, people often disputed that today business decision is all measure by the top management or the top level hierarchy of a company. It is the top level people who set the figures and standards when it comes to sales ethically despite sales person is the one who playing the significant role in the ethical practice of everyday business.
In this paper I will first define sales ethics and what is oxymoron in the business term followed by examine some unethical sales behaviors. Meanwhile, I will discuss my points of view that why sales ethics is not an oxymoron by giving some real life examples that most of the time people act ethically in business. Sales or business ethics is the practice of ethical values to business behaviour or sales function. It is a form of implemented ethics that examines rules and principles in a company.
We can see that from boardroom plan and how a company treating their suppliers to sales techniques and accounting practice, those are all applies in all business conduct. (Clive 2011) In organizational set up, ethics can be explained as the rules or standards governing the behaviours and performances of individuals and organizations. (Clark and Lattal 1993) The subject of business or sales ethics has been around since the very first sales exchange trade. For example, the Code of Hammurabi, created nearly 4,000 years ago, listed out that Mesopotamian rulers attempted to create honest prices.
In the fourth century BCE, Aristotle discussed the vices and virtues of tradesmen and merchants. The Old Testament and the Jewish Talmud discuss the proper way to conduct business and even includes topics such as fraud, theft, misleading advertisements, environmental issues and just prices. (Brief Guide to Business Ethics 2011, 2). While for oxymoron, it is said that two contradictory terms appear alongside. An oxymoron appearance is when two words that normally will not go together are combined. (Surhone, Timpledon et al. 2010). For instances, “And faith unfaithful kept him falsely true.
” (Tennyson 1859) taken from line in Tennyson’s Idylls of the King contains two oxymoron, “faith unfaithful” and “falsely true”. Body According to sales professionals and business enthusiasts, the driving force behind unethically dealings is more often than not, given that the competitive pressures of the marketplace today. The burden tends to brought up by quotas, pay plans, job insecurities and a selling environment that encourages aggressive competition in too many cases erodes the morality of individual employees with the sole focus of ‘Profit & Sales’ (Cadogan, et al. 2009, 912).
Oftentimes sales people are not monitored very strictly thus they can make decisions that greatly benefit themselves instead of the company. Sales people think that “business must do whatever it takes to survive. ” (Albert Carr 1968). “There is one and only one social responsibility of business is to use resources designed to increase its profits. ” (Milton Friedman 1970). As a result, the issue arises of sales ethics is an oxymoron. Most of the time sales people do not reach their quota set by company, therefore they have to break the rules provided by the company to achieve the target of the company given.
In my opinion, by breaking these rules they are making unethically decision. For example, Toyota Company was practicing unethical behaviour back to 2010. There was a tragedy where an officer and his three family members were killed in an accident. According to the article in the Los Angeles Times, Toyota issued a statement mentioning that due to the installation of an improper floor mat from another vehicle is the cause of the car crash. However, there is another crash one month later.
Toyota then finally admitted them neglecting consumers’ safety by saying a mechanical problem can cause the gas pedals to stick and cause unwanted acceleration by recall investigation 2. 3 million of its vehicles. (Ken Bensinger 2010) The Associated Press stated that Toyota showed the financial benefit of delaying recall investigation. Toyota said a phase-in to new safety regulations for side airbags saved the company $124 million and 50,000 man hours. Delaying a rule for tougher door locks saved $11 million. (Corey Mack 2010).
Toyota is one of the world’s profitable company, however the more profits they make, the more they lower the worker wages. However, on the other hand we clearly know that a business will never perform well if there is no ethics. Ethical decision in business is a fundamental part of the foundation in society. There is always a great deal of trust and integrity between sales people and customers. A business or society that lacks of ethical principles, they can lose that legitimacy and ultimately the business itself as exemplified by Arthur Andersen.
(Duska 2000; Kelly 2002). Additionally, there is also standpoint states that company do have the obligation to practice employees and sales people act ethically beyond mere legal compliance. (Kelly 2002). Furthermore, in this ideal business dealing that requires free choice, it is clearly telling us that coercion is incompatible in the market. It shows that when honesty, trust, and lack of coercion are apply in everyday business dealings, monitoring costs are lowered, sales is overall more efficient, and ideal conditions for market interchange are provided.
(Duska 2000). According to a research of observation in the customer’s perspective in ethical sales behaviour, it shows that by practicing ethical behaviour return in a better quality relationship between the salesperson and customer. The results show that it has a positive effect on customer satisfaction, trust and commitment to the salesperson whenever they apply ethical sales behaviour into practice. Ethical sales behaviour plays an essential part in affecting the quality of the buyer-seller relationship. (Roman and Ruiz 2005).
Taking Abbot Laboratories as an example, Abbot Laboratories – a leading global health care company instituted the role Chief Ethics Officer in the management level to establish an effective ethics program. They practice the ethical behaviour by asking their sales and marketing people to play a video game. In the video game it involved a virtual salesperson called Joe. The employees are exposed to practical ethical dilemmas confronted in their sales environment thus to practice the employees making the ethical decision.
However, provided that the employees choose the answer that over ethical behaviour, Joe, the salesperson in the video game is lit up with a thousand volts of electrical shock. Another example is when the new chief executive of MCI, Inc. now WorldCom, which emerged from bankruptcy in April 2002, altered the company culture and reputation in part by taking integrity and ethics behaviour as key priority. Brian R. Levey, Deputy Ethics Officer at WorldCom has said that, “WorldCom is a company committed to doing the right thing. “We’re emphasizing to all employees that preventing ethical violations is a responsibility.
” (Brooks and Dunn, 2009, 481). Conclusion As above mentioned, it is undoubtedly that sales ethics is not an oxymoron. In my opinion, I do not agree that sales ethics is an oxymoron. It is true that there are some unethical business behaviours in the marketplace, however that is always an exception. On the whole, most of the time people in business act ethically in order to have long term customers. In conclusion, if sales people engaging in unethical sales behaviour, as a result of low productivity and other measures of efficiency may be affected as well because sales people tend to maximise their own benefits and neglect company goal.
(Ferrell and Gresham 1985). Overall, ethical behaviour in the sales environment should be implemented by making employees aware of ethical issues in the first place. It should begin with upper management level such as managers, executives and CEOs. If the leader were successful in setting a proper example and practice the standards for ethical behaviour, the employees would be motivated to perform better quality for themselves.