The High Cost of Low Ethics."Good management -- that is, management with real thought behind it -- does not bother trying to make its way by trickery Trickery
See also Cunning, Deceit, Humbuggery.
Bunsby, Captain Jack
trapped into marriage by landlady. [Br. Lit.: Dombey and Son]
cheated of bride after lavish wedding preparations. [Span. Lit. , for it knows that fundamental honesty Is the keystone key·stone
1. Architecture The central wedge-shaped stone of an arch that locks its parts together. Also called headstone.
2. The central supporting element of a whole. of the arch of business. It knows that you will fail if you think more of matching competitors than of giving service, that you will fail if you put money or profits ahead of work, and that there is no reason why you should succeed if what you do does not benefit others."
Would you believe that the speaker was Harvey Firestone fire·stone
1. A flint or pyrite used to strike a fire.
2. A fire-resistant stone, such as certain sandstones.
Noun 1. ? Firestone Tire and Rubber Co., founded in 1900, was one of the first manufacturers of automobile tires. Over the next nearly 40 years, Harvey Firestone gained a reputation for valuing common sense, tightly controlling every aspect of his company and serving as its chief salesman, financier and production manager. At his death in 1938, his company had grown from a start-up in an infant industry to an established market force that had survived the Great Depression. Firestone continued to grow, merged with Tokyo-based Bridgestone in 1990 and today is the second largest tire manufacturer in the world.
How unfortunate that Firestone is now associated with defective tires, SUV rollovers, denial of any problems and possible non-disclosure -- even cover-up. Many people are now questioning the tires' safety and the company's integrity. Because of poor-quality product and management's controversial handling of the crisis, the great company that Harvey Firestone dreamed of and built -- and its 100-year-old reputation -- is now tarnished.
How did this happen? It seems that when Firestone's management first became aware of the tire tread tread
injury to the coronet of the horse's hoof by treading on it by the opposite hoof, or by another horse when they are being worked in a team. If the coronary matrix is injured there may be a subsequent crack or deformity. separation, blow-outs and claims, they were more concerned with their financials than with safety, quality or potential ethical problems. But the financial impact they were contemplating then probably would look like the deductible That which may be taken away or subtracted. In taxation, an item that may be subtracted from gross income or adjusted gross income in determining taxable income (e.g., interest expenses, charitable contributions, certain taxes). to a major medical compared to what the tire recall and its ramifications ramifications npl → Auswirkungen pl will eventually cost them.
In the near term, Bridgestone said it will take a one-time charge of $350 million for the recall, and analysts predict a major sales slowdown this year. More importantly, however, the damage done to Firestone's reputation for denial and alleged cover-up when families were dying will be burned in the buying public's mind for years.
Contrast Firestone to Johnson & Johnson, the makers of Tylenol, which in 1982 dealt ethically with the problem of product tampering tampering The adulteration of a thing. See Drug tampering. and became the model for ethical behavior and good crisis communications Crisis communications are generally considered a sub-specialty of the public relations profession that is designed to protect and defend an individual, company, or organization facing a public challenge to its reputation. . When seven people died after taking cyanide-laced Tylenol, the company immediately alerted the nation through all media not to consume any Tylenol products. Moreover, it told consumers not to resume using the products until the extent of the tampering could be determined. Along with stopping production and advertising, Johnson & Johnson recalled all Tylenol capsules from the market, eventually recalling and destroying 31 million bottles with a retail value of more than $100 million. Johnson & Johnson stock declined in the weeks after the scare, but soon rebounded because of the company's proactive ethical behavior and proactive communications.
Why did Johnson & Johnson's behavior differ from Firestone's? Robert Wood Johnson Robert Wood Johnson was the name shared by members of the family that descended from the President of Johnson & Johnson:
It appears that Firestone had no written ethical guidelines guidelines,
n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. that should have pushed the company to take swift and ethical actions. Rather, top managers seemingly were hurt by the slow, quiet, consensus-building style of Japanese decision-making. Crises don't allow time for such cultural correctness, however. Despite any organization's best-laid plans, there will always be problems and/or accidents. How it responds is what defines the character of management and the organization as a whole.
What's interesting is how often corporate value statements or credos are conspicuous con·spic·u·ous
1. Easy to notice; obvious.
2. Attracting attention, as by being unusual or remarkable; noticeable. See Synonyms at noticeable. by their absence. In many businesses, it seems as though values and ethics ethics, in philosophy, the study and evaluation of human conduct in the light of moral principles. Moral principles may be viewed either as the standard of conduct that individuals have constructed for themselves or as the body of obligations and duties that a are considered just flowery flow·er·y
adj. flow·er·i·er, flow·er·i·est
1. Of, relating to, or suggestive of flowers: a flowery perfume.
2. Abounding in or covered with flowers.
3. words about honesty and integrity. Or, perhaps many people believe that businesses simply run on the golden rule of "treat others as you would want to be treated." Unfortunately, many people think the golden rule is, "He who has the gold makes the rules."
Put It In Writing
If you don't have a written values and ethics statement that establishes in black and white the standards of behavior you want for your organization and what you will hold yourself accountable for, then your organization is just operating randomly, making up the rules along the way. Ethical behavior must be one of your fundamental business strategies, and one driven from the top.
At Manchester, we have vision, mission and corporate values statements. Our vision statement describes our purpose, creates a mental image of the future state of our organization and identifies growth opportunities. Our mission statement expresses our primary goal, and our corporate values statement lists and describes in detail the values and beliefs that we share as a firm. In general, corporate values and ethics statements should discuss your desired relationships with your customers and other stakeholders Stakeholders
All parties that have an interest, financial or otherwise, in a firm-stockholders, creditors, bondholders, employees, customers, management, the community, and the government. , your people, your community, profits, standards for management and general ethical values.
The most important value we describe in our statement is our reputation. An organization's reputation is something that's earned slowly over a long period, but, as Firestone's example shows, can be quickly lost. Too often, financial executives focus only on tangible assets Tangible Asset
An asset that has a physical form such as machinery, buildings and land.
This is the opposite of an intangible asset such as a patent or trademark. Whether an asset is tangible or intangible isn't inherently good or bad. , perhaps because they can be measured more easily. Consequently, employees do, too, because they follow their leaders and because, as the saying goes, what gets measured gets done. In many organizations, not enough attention is given to the intangible asset Intangible Asset
An asset that is not physical in nature.
Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. of reputation, which should be regarded as an organization's most valuable asset.
Another value we talk about is leadership. There is a difference between management and leadership; leaders do the right things, while managers last do things right. In all areas, but especially when it comes to ethics, the leader sets the tone and character for the entire organization.
We also describe what we mean by "highest ethics" -- dealing fairly with others, disclosing and avoiding conflicts of interest, keeping promises and encouraging associates to raise ethical issues. Ethics is about behavior; about making choices between right and wrong and understanding that these are black-and-white decisions -- there is no gray zone. Our corporate values and ethics statement says that we will forgo business, regardless of the opportunity, that would require violating our principles.
If you haven't addressed ethics yet, let me remind you that ethical problems usually don't occur because someone intentionally in·ten·tion·al
1. Done deliberately; intended: an intentional slight. See Synonyms at voluntary.
2. Having to do with intention. did something wrong. They happen because good people made mistakes, lacked appropriate training or didn't have enough information. These problems can be mitigated by making sure that training programs address ethical issues, establishing and discussing corporate values on a regular basis, and by demanding compliance and confidentiality when employees bring ethical issues to your attention.
This isn't something you can delegate to "staff." It's up to top managers to set the tone and character for the organization. As Harvey Firestone said, "If anything in the business is wrong, the fault is squarely square·ly
1. Mathematics At right angles: sawed the beam squarely.
2. In a square shape.
3. with management. If the tires are not made right, if the workmen are unhappy, if the sales are not what they ought to be, the fault is not with the man who is actually doing the job, but with the men above him and the men above them, so that, finally, the fault is mine."
Mark Sheffert is chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Minneapolis-based Manchester Companies Inc. (www.manchestercompanies.com), which provides business recovery, financial and management advisory services advisory services
advisory services provided to the public, in their capacity as owners and managers of animals, are an important part of veterinary science. They may be provided by government bureaux, by commercial companies who deal in pharmaceuticals or animals or animal , He can be reached at email@example.com. or 612.338.4722.