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Posts Tagged ‘business ethics

summer reading: spotlight on conflict and decision-making by consensus at premium cola

As some of our dear orgtheory readers know, I am always on the look-out for interesting articles about how organizations use collectivist or participatory-democratic practices. One recent publication I would like to highlight involves a collectivist group fueled by a common love of cola, coffee, and beer.

Fans of a caffeinated soft drink, frustrated by Afri-Cola new owner’s refusal to change the recipe back to the original*, became the new owners and producers of the drink. Not only did they band together to revive the original product using what they considered to be more ethical market standards, they organized using the practice of decision-making by consensus.**

Participatory-democracy invariably elicits conflicts that might be avoided or suppressed under more hierarchical organizations. Members have to learn how to manage contention if they wish to stay cohesive. Premium Cola‘s members had to learn how to do this via a discussion email list.

Husemann, Ladstaetter, and Luedicke’s (2015) “Conflict Culture and Conflict Management in Consumption Communities” examines the types of conflicts and actions taken to address these conflicts within Premium Cola. The authors note the generative qualities of routinized conflict, including the reaffirmation of commitment to a collective mission:

When analyzing the Premium community’s conflicts, we found that the community’s conflict culture involved a limited set of routinized and recurring conflict behaviors. Members use behaviors such as inviting conflict, showing respect for otherness, or releasing aggressions to argue different topics, but use them in similar ways. Many of these behaviors are known from normative conflict sociology as conflict cultivation practices, i.e. routinized behaviors that conflict parties use to perform conflicts in civilized and productive, rather than destructive, ways. Through inventing, selecting, abandoning, enacting, or improving such routinized conflict behaviors, Premium community members are able to produce value rather than destroy value through uncontrolled or abusive conduct.

In contrast, transgressive conflict, in which participants break multiple norms, can lead to abusive interactions. These lead to more active interventions, including the eventual expulsion of a member over his repeated sexist comments about the hiring of a female intern and insults of other members. While the exchanges threatened corrosion, the subsequent actions taken reaffirm Premium Cola’s identity and commitment to community.

* The original recipe had less sugar and more caffeine than the newer recipe.

**More about the fascinating history and ethos of Premium Cola is available here, where the Ladstaetter and Luedicke describe Premium Cola as follows:

…the Premium Cola community can be seen as a group of “productive activists,” e.g.,
prodactivists, that combines the roles of producers, consumers, and social activists to promote change in the capitalist market system by demonstrating how market exchange can be both successful and ethical.

Written by katherinechen

June 29, 2015 at 3:39 pm

sociology compass article by Liz Gorman now available: “Professional Self-regulation in North America: The Cases of Law and Accounting”

UVA sociologist Elizabeth “Liz” Gorman has recently published a state-of-the-field article on self-regulation among lawyers and accountants in the Organizations and Work section of Sociology Compass:

Professional Self-regulation in North America: The Cases of Law and Accounting

Abstract
Professional and expert work holds the potential for misconduct that can harm clients or the public. According to the traditional model of professional self-regulation, developed during the “golden age” of the professions in the mid-20th century, societies grant professional communities freedom from external regulation in return for their commitment to regulate their members’ conduct. Professions were said to cultivate distinctive ethical norms, socialize new practitioners, and engage in social control of deviant behavior. In light of dramatic changes in the professional world since that time, this essay reviews research on the legal and accounting professions in North America to assess the extent to which this traditional model still holds. The two professions continue to resemble the traditional model in some respects but diverge from it in others, and on some points, there is insufficient evidence to draw a conclusion. The traditional model of self-regulation is probably best viewed as an ideal type that can serve as a standard of reference, not as an accurate representation of social reality. This conclusion opens up new topics for research and opportunities to inform policy.

This is a great overview for thinking through how effective internal governance units (from SAF theory), ethics courses, and peers are for monitoring professionals’ conduct.

 

"For lawyers, the fundamental ethical principle is “zealous advocacy” on behalf of the client" (Gorman 2014: 492)

HLS graduates celebrate: “For lawyers, the fundamental ethical principle is “zealous
advocacy” on behalf of the client” (Gorman 2014: 492)

 

Written by katherinechen

June 19, 2014 at 12:54 pm

lifting the crimson curtain: Manufacturing Morals: The Values of Silence in Business School Education

As a grad student, I always found crossing the bridge over the Charles River from Harvard University to the Harvard Business School (HBS) to be a bit like approaching Emerald (or more appropriately, Crimson) City. On the Allston side, the buildings seemed shinier (or, as shiny as New England vernacular architecture allows), and the grounds were undergoing constant replantings, thanks to a well-heeled donor. In addition, HBS has loomed large as an institution central to the dissemination of organizational theory and management practices, including Elton Mayo’s human relations.

HBS has certain peculiarities about teaching and learning, like the use of case studies which follow formulaic structures as the basis for directed class discussion.* Moreover, instructors follow a strict grading break-down: mandatory “III”s assigned to the lowest-performing students of classes – a source of concern, as students with too many IIIs must justify their performance before a board and possibly go on leave.** To help instructors with grading, hired scribes document student discussion comments.***

Such conditions raise questions about the links, as well as disconnects, between classroom and managerial leadership, so I was delighted to see a new ethnography about business school teaching at the UChicago Press book display at ASAs.

With his latest book, Michel Anteby lifts the crimson curtain from HBS with his new book Manufacturing Morals: The Values of Silence in Business School Education (University of Chicago Press, 2013).

anteby-jacket

Here’s the official blurb:
“Corporate accountability is never far from the front page, and as one of the world’s most elite business schools, Harvard Business School trains many of the future leaders of Fortune 500 companies.  But how does HBS formally and informally ensure faculty and students embrace proper business standards? Relying on his first-hand experience as a Harvard Business School faculty member, Michel Anteby takes readers inside HBS in order to draw vivid parallels between the socialization of faculty and of students.

In an era when many organizations are focused on principles of responsibility, Harvard Business School has long tried to promote better business standards. Anteby’s rich account reveals the surprising role of silence and ambiguity in HBS’s process of codifying morals and business values. As Anteby describes, at HBS specifics are often left unspoken; for example, teaching notes given to faculty provide much guidance on how to teach but are largely silent on what to teach. Manufacturing Morals demonstrates how faculty and students are exposed to a system that operates on open-ended directives that require significant decision-making on the part of those involved, with little overt guidance from the hierarchy. Anteby suggests that this model-which tolerates moral complexity-is perhaps one of the few that can adapt and endure over time.”

Check it out! And while you’re at it, have a look at Anteby’s previous book, Moral Gray Zones (2008, Princeton University Press).

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Written by katherinechen

August 27, 2013 at 10:43 pm

can you outsource reputation management?

Saku 

I’d like to thank Teppo for inviting me and the other owners of this arena for having me. I have been lurking around this blog every once in a while for some time now and am impressed with what you are doing.

When Teppo asked me to visit, my first reaction was: please, let me prepare. I am working on a million things right now and need to gather my wits to rise to the occasion. My second reaction was: wait a minute, I can use this exalted arena to vent out whatever ideas I am currently working with, maybe get some feedback or at least get the engine running each morning. Incidently, this morning is a rather solemn occasion: Columbine High School -type shooting took place yesterday in a Finnish high school (http://www.yle.fi/news/id74371.html) and everybody’s pretty shaken up, as this is extremely rare in our context. I wish I had something profound to say about this but maybe it’s best to leave this open to interpretation.

The topic I would like to discuss today reputation management, a topic which has been studied stateside for instance by such people as Charles Fombrun and Violina Rindova, and in Europe by Majken Schultz and others. I’d like to introduce a phenomenon which Pekka Aula, my co-author and I have been looking at lately, the outsourcing of reputation management by some firms.

Reputation building: doing good stuff

At the intuitive level, you create a good reputation by

1. Doing good stuff

2. Doing it to parties who are in a good network position to spread the word

3. Being communicative about the good that you do.

Charles J. Fombrun begins his book Reputation, which many consider the rallying call to managers regarding the importance of reputation:

“Do you recall the last time you hired a contractor to make improvements to your house or apartment? Or the last time you called on a travel agent for assistance in planning a trip? […] If you are like most people, you didn’t just pick their names out of a phone book. You probably went to them because they were recommended to you by a family member, friend or someone else you trust. If so, you hired them based on their reputation.” (Fombrun, 1996, p. 1)

Choosing hairdressers, dentists, carpenters, real estate agents and so on in our personal lives is a tangible example of, not just how reputation can be an asset to a business, also how it is built in a network. Herein lies one of the key messages of reputation management (I think): when building your reputation, do not try to communicate promises that you will not keep, either now or in the future. In a recent paper in Strategic Organization (5/1, 2007) Rindova, Petkova and Kotha build an inductive account of how new businesses build reputations in the media. They argue that firms build reputation on three kinds of action patterns:

  • Symbolic actions
  • Innovative actions
  • Action level and composition

Read the Rindova et al. paper if you want to know these mean, and how the process or reputation building is mediated by stakeholder cognitions. My point is just that reputations are built fundamentally on actions, not in PR or marketing. Indeed, my coauthor Pekka Aula once noted that: “marketing increases reputation risk.”

Can you outsource the good stuff?

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Written by smantere

November 8, 2007 at 5:13 pm