Introduction
Ethics refers to the judgment of an individual on deciding right and wrong. During the decision making in corporations, the individuals are expected to make ethical decisions in order to ensure a morally “right” culture throughout the company. Other than various functions that an organization practices, ethics has also emerged as a key role when it comes to dealing with a corporation. (Ethical business practices: A Cadbury Schweppes case study, n.d.).
Need for “ethical officer”
Corporate ethics is a subset of corporate leadership, culture and the various programs that a company runs. According to a recent research conducted by Massachusetts-based Ethics Officer Association, the employees rated human resource department to be more cooperative and obliging when it comes to dealing with various corporate ethical issues. The human resource department is considered as a bridge between the company’s culture and legislation and the employees. It is the also core part of policy making and ensuring the implementation. (Driscoll & Hoffman, 1998)
Having said that, I feel that there is no need for an inconspicuous ethics officer within an organization, as the whole human resource department is responsible for ensuring ethical alignment within the organization culture. One of the major responsibilities of human resource department is policy making which is a major component of ethics management. The human resource department deals day to day with the employees which puts it in a better place to inculcate ethical values in the organization. As a part of policy making, human resource department is responsible for ensuring policy making at all levels which ensures that ethical values are practiced as a part of the organizational culture.
Human resource department has to make sure that there prevails an ethical mindset in each and every individual in the company, specially the heads of the department so that they may be able to lead by example.
Human Resource Professionals as custodians of ethics
Ethic management within a corporation comes under the jurisdiction of the human resource management. It does not require a separate wing or division to be formed for this purpose. The core of ethics management lies in the various policies of the organization; be it recruitment or performance management. Since this comes under the jurisdiction of policy making which is a job role of the human resource department, so I feel there is no need to have a separate role for this function. Adding a separate role would be a costly measure for the organization along with creating redundancy in the roles of the human resource officer and the ethic officer. (Collaboration between the Ethics function and HR, 2004)
Situational analysis
The current case of XYZ Corporation depicts a scenario where the sales staff is habitual of over promising to the clients in order to get maximum commission. This in turn makes a problem for the rest of the departments to fulfill the commitment as they have to put in extra hours.
The unethical issue highlighted here is that despite of knowing that the company does not have ample capacity, the sales team takes in orders which puts extra pressure and also at times makes them lose a customer.
In order to overcome this fiasco, the company needs to work right from the beginning, that is, the policies needs to be revised from the time the employees are being hired. The recommended policies can be divided into three phases which includes:
- Pre recruitment strategy
- Post recruitment strategy
- On the job strategy
Pre recruitment Strategies
- Recruiting people with high moral values:
While recruiting sales people in the organization the human resource should check for their past record and gauge them over their previous ethical conducts. A profile check should be run from the company the candidate is currently working for, the employee from various functions of the organization that he currently interacts to along with the customer portfolio he used to manage. A huge weightage should be given to the ethic aspect when it comes to recruiting people. (Vickers, 2004)
Post Recruitment Strategies
A code of ethics should be designed specifically for the sales people, as already mentioned that’s sales people play a very significant role in the company’s reputation as they are in the forefront, dealing with the customer.
This code should include areas focusing on realistic sales targets, customer satisfaction and building long term relationships with the customers. The code should also focus on achieving the company’s goal rather than working towards their personal aims and achieving the ends.
Overpromising to the customers should also be treated as a separate subject in the code as it is the major problem that the company is facing currently. Clear penalties should be highlighted in case of any over promising is seen by them. (SHRM Code of Ethics SHRM Code of Ethical and Professional Standards in Human Resource Management, 2007)
- Ethics training:
All the employees should go through ethics training as soon as they are hired. This will enforce to the newly hired employees that how important ethics is to the company. The training should highlight the importance of company’s goal and every employee should work together to attain the company’s goal which would eventually help them meet their professional goals of growing and developing. (Vickers, 2004)
Over promising to customers should be emphasized as a negative attribute to them as its adverse effects may hamper the company’s reputation in the long term. The negative impact that the over promising of the sales staff may have on the company internally and externally should be communicated to them very clearly.
On the Job strategies
- Reiteration of company’s vision and objectives
All the employees should be well versed in the company’s mission and vision. Individual goals should come out of the company’s goal for the period. In a situation where the sales people are only concerned about their commissions rather than company’s reputation or unnecessary pressure that is put on other departments, is a reason of concern for the overall organization.
The human resource department should inculcate a sense of responsibility in the sales team and coach them on how all the employees should serve as one team to get to the company’s goal which should eventually help them in attaining their professional goals individually. (Ingram, n.d.)
- Sales training:
Sales trainings are a critical part of every organization. Sales representatives are the face of the company and it is very important for the company to invest in them. Considering the current scenario of the company, a module that covers this ethical dilemma should be added to the sales training.
Over promising should be treated as a separate subject all together in the sales training process. Sales people should know how their over promising impedes the reputation of the company and may cause them lose their customers in the long run. Not only is that, but the repercussions internally for overpromising should also be highlighted to them. (Ingram, n.d.)
- Reward system
Along with the sales incentives, the company should also have certain penalties for those that may cause a problem internally due to over promising to the clients. Clear performance management system should be in place which deducts points every time an employee is seen over promising in order to get maximum sales incentive. It should be made clear in their KPIs that over promising will penalize them rather than getting additional sales commissions. This would discourage the sales personals for over committing to the customers. (Vickers, 2004)
Conclusion
Over commitment by the sales people of XYZ corporation may have an adverse impact on the company in the long run both internally and externally. Covering internally specifically, it may cause unnecessary pressure to the other departments like production which may increase employee dissatisfaction and high turnover eventually. Moreover, externally it will have a bad customer experience for the clients as a lot of times the company may not be able to fulfill the required order. This is a killing situation for any organization where it is creating dissatisfied customers.
References
Driscoll, D., & Hoffman, W. (1998, April 1). HR Plays a Central Role in Ethics Programs. Retrieved November 15, 2014, from http://www.workforce.com/articles/hr-plays-a-central-role-in-ethics-programs
Ethical business practices: A Cadbury Schweppes case study. (n.d.). Retrieved November 15, 2014, from http://businesscasestudies.co.uk/cadbury-schweppes/ethical-business-practices/the-importance-of-ethics-in-business.html#axzz3J2NOpUl6
Collaboration between the Ethics Function and HR. (2014, April 1). Retrieved November 15, 2014, from http://www.ibe.org.uk/userassets/briefings/b40_hr.pdf
Vickers, M. (2004, September 10). HR's Role in Promoting Ethics. Retrieved November 15, 2014, from http://www.i4cp.com/trendwatchers/2004/09/10/hrs-role-in-promoting-ethics
Ingram, D. (n.d.). The Importance of Ethics in Human Resources. Retrieved November 15, 2014, from http://smallbusiness.chron.com/importance-ethics-human-resources-12780.html
SHRM Code of Ethics SHRM Code of Ethical and Professional Standards in Human Resource Management. (2007, November 16). Retrieved November 15, 2014, from http://www.shrm.org/about/pages/code-of-ethics.aspx
