In every society, people do advocate for ethical practices in any kind of activity. This is mainly because the ethics lead to the development of a form of trust between the involved parties. Ethics do apply in business as well. However, as investors seek to improve their profits, they at times fail to consider ethics more carefully. The essay below looks at this issue in a greater detail.
Business Ethics
Introduction
It is well known that the main reason as to why people engage in business activities is so as to make profits. However, many people do not seem to agree on the proper methods which can be applied to achieve this goal. Some even call for unorthodox methods which might not be accepted by the society. This is the reason as to why business ethics were introduced so as to protect the rights of consumers from unscrupulous business people. This might seem like a bullet on the feet for business people. However, it is actually possible to practice business ethics and still make profits. This is the idea put forth by Putnam (2002) who illustrates that businesses which have higher ethical values tend to have more customers as well as customer preference. This leads to their success. This is an indication that ethics do not limit the performance of the business in any way.
Wadhwa (2009) cites another factor indicating that running businesses ethically can still assure the company of the much needed profits. He indicates that when businesses are run ethically, the employees also seem to be motivated and have the morale to work. As such, they deliver to their level best, and this productivity leads to good work both in quality and in quantity. Of course, these two are the recipe to a successful business entity. From this discovery, it can be said that the secret behind a successful business is not greed or unethical conduct. Rather, doing the right things and in the right manner always leads to sure success. It is for this reason that investors are advised to observe ethics in what they do.
Lessons Learnt
The scenario above indicates that the ethics issue is very sensitive and has to be approached with much caution. The first issue would be to understand the ethical and unethical habits. Frater (2011) indicates some of the unethical businesses that are common in the corporate world. The first one is within the company itself where the employees are treated as commodity rather than people. They get discouraged and fail to deliver as expected of them. Dishonesty and poor quality of products and services is another factor that tends to push away the customers, leading to failure. These are just but some of them.
On the other hand, there are the ethical habits that lead to success in business. Putnam (2002) cites these factors as honesty, quality, trust, respect, teamwork and a sound leadership. These factors ensure that the company and its employees become good corporate citizens who can compete fairly in the field. The main idea is to have the business personnel understand that as they chase the profits, there is the need to remember that the consumers are the first priority. Whatever has to be done, the business people should be aware that it is the consumer who comes first. Satisfy the consumer and everything else is in line. Give the consumer the best, and in return, the consumer will easily part with his money.
Another main lesson from the study is that ethical businesses tend to do well. Even though they might fail to pick fast, yet they tend to grow gradually to a time when they are fully established. The main reason for the long-term success is that people tend to develop confidence with the company (Wadhwa, 2009).
Why Unethical Businesses Failed
After going through the study, it was realized that there were several reasons as to why the unethical businesses failed. First of all, there is the failure in the financial sense. As Wadhwa (2009) indicates, many companies fail to observe the ethical standards mainly because the managers or other employees are greedy for money. As such, they try all means possible to draw more from the consumers. As this happens, the level of dishonesty rises and the employees start vandalizing company’s property or even embezzling the funds. In the long run, the company loses financially.
Another main reason as to why the businesses fail is the fact that there are laws and regulations regarding to business practices. As such, when the companies disregard these regulations, the consumers file complaints in courts of law. Definitely, the companies are found guilty of the accusations and are forced to pay quite a lot to the consumers as compensation. This has an effect on the company incomes, since it is an expenditure that is not planned for. Paying out the compensation fees eats into the company’s profits, leading to financial loss.
Why Ethical Businesses Succeeded
After looking at the failure of the unethical businesses, it can be assumed that the results for running a business ethically should be the opposite of the above. This might be true, but there are special reasons as to why ethical businesses do well. The first reason is that all the processes within an ethical business are carried out as specified by the law. As such, there are no short-cuts which can compromise the integrity of the business. Also, the processes of producing the goods and services are also fully carried out, hence leading to products which are of a wholesome quality. Of course, this interprets into better business.
It is well known that the success in a business entity is highly dependent on the consumer trust. This is one of the main factors that lead to the success of ethical businesses. As explained by Putnam (2002), these businesses tend to treat the consumers with much respect and dignity. Their level of integrity also appeals much to the consumers, hence bringing about the aspect of consumer preference. This is a stronghold of successful businesses.
The above paragraphs explain the main reasons as to why ethical businesses are successful. It also indicates that there is no need for greed and quick success, since this can be short-lived. After all, the saying goes that easy come is easy go. If business personnel are keen on making profits and maintaining their profit margins, they have to understand that success is not delivered on a silver platter. Rather, it has to be worked on, and ethical practices are on the top of the list.
Marketing
Successful businesses are known to be the businesses that have a strong marketing strategy. This is mainly because quality products cannot just fly off the shelves. There has to be a way of selling them. Marketing is also an area where most businesses fail. It is also the section of business which is very open to practicing of unethical practices. It, therefore, should be keenly watched. In this respect, Angie’s list of online marketing can be applied too ensure that there is integrity in business. Angieslist.com (2012) has it that there are three ways through which this method can be used for greater success. The first step is to identify the marketing opportunities that are there. This ensures that the efforts of the team are focused on a given direction. Second, the team should be well aware of the restrictions on the marketing strategy being used. Failure to adhere to these can have adverse effects such as prosecution in a court of law. The last point is to ensure that there is brand protection as this is the only way through which the company can steer away from counterfeit products.
Marketing by word of mouth is also another strategy that is widely used. However, many people do not understand how it can be fully utilized to deliver for the company. Gregory (2009) solves this problem by indicating that there are five simple steps that can be applied by the marketers. First of all, it is advised to start with friends since these are the people that can be easily won over. The second factor is offering the information to people who are influential. These can really help to move the product. This is the reason that companies at times contract celebrities to market their products. Generating a buzz about the product and getting the people excited about it also leads to conquering of more markets. However, all these fall under the umbrella of honesty, without which even the best marketing strategies are bound to fail. The consumer should simply get what he is promised.
Conclusion
The paragraphs above have looked at different aspects of business ethics. It has looked at the different ethical behaviors within the business fraternity and also highlighted the unethical behaviors. It has also provided evidence that businesses which are run unethically tend to fail while those that are ethically carried out tend to be very successful. Since this issue is quite controversial, attempts have been made to explain as to why the ethical businesses succeed while the unethical ones fail. It is well appreciated that marketing is the pinnacle of business success. This has also been an area which determines whether a business succeeds or fails. In this perspective, the essay has vividly explained the methods that can be used to ensure that there is success in this area. In a nutshell, the essay has addressed the issue of business ethics in such a manner that the reader can easily see the benefits of ethically running a business.
Angieslist.com (2012). Angie’s List Online Marketing Guidelines. Retrieved on 9th July 2012 from http://reviews.angieslist.com/CMSPages/GetFile.aspx?nodeguid=ce001d32-9306-4a05-b587-6a1e49a823fe
Frater, J. (2012). Top 10 Unethical Business Actions. Retrieved on 9th July 2012 from http://listverse.com/2011/09/13/top-10-unethical-business-actions/
Gregory, A. (2009). 5 Strategies to Maximize Word of Mouth Marketing. Retrieved on 9th July 2012 from http://www.sitepoint.com/5-strategies-to-maximize-word-of-mouth-marketing/
Putnam, M.S. (2009). Ethical Values for Business Success. Retrieved on 9th July 2012 from http://www.globalethicsuniversity.com/articles/valuesforsuccess.htm
Wadhwa, V. (2009). Why Be an Ethical Company? They’re Stronger and Last Longer. Retrieved on 9th July 2012 from http://www.businessweek.com/technology/content/aug2009/tc20090816_435499.htm
