Learning
Regarding the ethical culture change, the lesson is that the process should follow three key steps of culture diagnosis, intervention, and evaluation. On ethical culture diagnosis, the lesson is that it should entail auditing both informal and formal systems. It should also consider the peoples’ assumptions. On the other hand, the intervention should involve both formal and informal systems change and could take long; 6 to 15 years. Also, intervention entails challenges in changing the informal systems; hence need to overcome them for success. Finally, there should be culture change evaluation over a long period. The evaluation should apply repeated interviews and surveys to determine norms’ change or identify potential problems.
In summary, the lesson is that organizations seeking to change of develop an ethical culture needs to address the complex mix of informal and formal systems that supports unethical or ethical conduct. In that view, there is a need for a multisystem approach that follows the three stages of the process.
Example
Given the lessons, a good example of the ethical change process application would be regarding a financial firm where the current conduct entails offering loans to customers who the credit officers know that they cannot afford. In such case, the driving motive would be enhancing the officers’ performance regardless of the effect that the practice would have on the customers and the market. With that, changing the culture should first seek to identify whether there are codes of conduct and standards stipulating the qualifications for a loan. Then there should be intervention by establishing measures to ensure that only the qualified customers are awarded the loans. Finally, the organization’s leadership should conduct interviews and surveys to identify how the culture have changed and whether there could be possible problems such as collusion between the officers and the customers to hide, or fabricate some information regarding the customers’ financial status.
First regarding whether TAP’s ethical culture was in alignment or misalignment, the fact that some of the conducts of the sales representatives failed to follow the laws such as the requirement to record the samples given out is an indication of misalignment. Further, the overall issue of bribing is contrary to ethical codes and laws that prohibit the practice. Hence the culture of the company can be concluded as having misaligned with the set standards and laws.
Second, on the cultural change effort undertook by Douglas Durand, it is identifiable that they only undertook to change the informal system by inducing the sales representatives’ conduct through bonuses that rewarded better conduct regarding recording the samples given out.
Finally, on why the culture change failed, Durand did not employ a comprehensive approach that should have included changing both the formal and informal systems within the organization. Rather, they resulted in informal change by offering the bonuses that were later discontinued for the result of lack of formal systems that could have supported the practice. In that respect, they should have sought to develop codes that required the sales representatives to record the samples given out as well as spelling out procedures for the sales representatives’ activities such as promotion campaigns.
