Business Ethics Quiz

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Questions and Answers

What is the primary focus of business ethics?

Creating competitive advantages

Maximizing profits at any cost

Understanding market trends

Making decisions in the workplace (correct)

At which level of moral development does a person make decisions based solely on returns?

Conventional Level

Preconventional Level (correct)

Principled Level

Postconventional Level

Which of the following is NOT considered an element of business ethics?

Profit maximization (correct)

Respect

Law-abiding

Integrity

What is meant by 'issue intensity' in ethical decision making?

How significant the ethical issue is perceived to be Signup and view all the answers

Which individual characteristic is likely to influence ethical decision making?

Values Signup and view all the answers

Which of the following factors is NOT part of the steps to follow when faced with an ethical dilemma?

Establishing personal gain Signup and view all the answers

Which aspect is essential when addressing ethics in international business?

Considering cultural and social differences Signup and view all the answers

What does 'locus of control' refer to in the context of ethical decision making?

Perception of control over events in one's life Signup and view all the answers

What is a primary reason organizations engage in global sourcing?

To purchase labor or materials from the least expensive sources Signup and view all the answers

Which of the following is NOT a method for organizations to go global?

Networking Signup and view all the answers

What defines a joint venture in the context of international business?

Two organizations create an independent entity to pursue a specific project. Signup and view all the answers

Which global challenge is characterized by viewing the world solely from one’s own cultural perspective?

Parochialism Signup and view all the answers

What is meant by a foreign subsidiary?

An independent office established by a company in a foreign country Signup and view all the answers

What is a key principle of the United Nations global contract?

Anti-Corruption Signup and view all the answers

What can help facilitate change within an organization?

Education and communication Signup and view all the answers

What distinguishes creativity from innovation?

Creativity is the generation of ideas, while innovation is applying those ideas. Signup and view all the answers

What is a common cause of stress in the workplace?

Role overload Signup and view all the answers

What summarizes the classical view of social responsibility?

Profit maximization should be the main focus. Signup and view all the answers

What is a potential reason for resistance to change in an organization?

Comfort with habits Signup and view all the answers

Which of the following is a method to help employees adapt to new values?

Creating symbols and rituals Signup and view all the answers

What defines social responsibility beyond legal obligations?

Committing to long-term societal goals Signup and view all the answers

What is primarily affected by national culture according to shared values and attitudes?

Employee behavior and beliefs Signup and view all the answers

Which term refers to the belief that home country work practices are superior?

Ethnocentric Signup and view all the answers

What is one benefit of workplace diversity related to organizational performance?

Enhanced problem-solving ability Signup and view all the answers

Which of the following is a challenge of diversity in the workplace?

Age-related adaptability issues Signup and view all the answers

What perspective allows a manager to consider best practices from around the world?

Geocentric Signup and view all the answers

What effect can gender inequality have in a workplace?

Lower morale and productivity Signup and view all the answers

In the context of workplace diversity, what could lead to a hostile work environment?

Race and ethnicity discrimination Signup and view all the answers

Which is a strategic benefit of workplace diversity?

Increased understanding of the marketplace Signup and view all the answers

What is the primary purpose of Employee Resource Groups in an organization?

To share qualities, interests, or goals among employees Signup and view all the answers

Which type of bias involves a person believing they could have predicted an event after knowing the outcome?

Hindsight bias Signup and view all the answers

Which of the following describes the concept of 'Design Thinking'?

Managing problems as designers manage design tasks Signup and view all the answers

What is considered a self-serving bias?

Taking credit for successes and blaming failures on external factors Signup and view all the answers

Which approach utilizes complex datasets to improve decision-making?

Big Data Signup and view all the answers

What does the term 'Immediate Gratification' refer to in the context of decision-making biases?

Choosing short-term benefits over long-term costs Signup and view all the answers

In which scenario does 'Selective Perception' bias typically occur?

Organizing events based on pre-existing biases Signup and view all the answers

What is the primary function of mentoring in an organization?

Providing advice and guidance from experienced employees to newer workers Signup and view all the answers

Study Notes

Business Ethics

Ethical principles guide morally right and wrong decisions and behavior in the workplace.
Key elements of business ethics include: integrity, fairness, law-abiding conduct, respect, and responsibility.

Ethical Dilemmas

Ethical dilemmas are situations where it is unclear what the right or wrong course of action is.
A systematic approach to resolving ethical dilemmas involves considering:
- What is the dilemma?
- Who is affected by the dilemma?
- Which factors are important in this decision?
- What are the alternatives?
- What is the final decision and how will you implement it?

Ethical Decision Making - Stages of Moral Development

Preconventional Level: Decisions are based on the potential consequences for the individual.
Conventional Level: Decisions are guided by the expectations of others and societal norms.
Principled Level: Decisions are based on self-chosen ethical principles and a sense of personal responsibility.

Moderators of Ethical Decision Making

Individual characteristics:
- Values: Personal beliefs about what is right and wrong.
- Ego strength: Strength of convictions and commitment to values.
- Locus of control: The degree to which individuals believe they can control their own destiny.
Structural variables:
- Organization's structure: The formal arrangement of roles, responsibilities, and reporting relationships.
- Organizational goals: The overarching objectives that the organization seeks to achieve.
- Performance appraisal: The process used to evaluate employee performance.
- Reward allocation: The system for distributing rewards to employees.
Issue Intensity:
- Greatness of harm: The magnitude of the potential negative impact of a decision.
- Consensus of wrong: The degree to which people agree that an action is wrong.
- Probability of harm: The likelihood that harm will occur.
- Immediacy of consequences: The time frame between a decision and its consequences.
- Proximity to victims: The closeness of the decision-maker to those who will be affected.
- Concentration of effect: How widespread the impact of the decision will be.

Ethics in an International Context

Cultural differences need to be considered when making ethical decisions in a global context.
Laws and regulations specific to international business, such as the Foreign Corrupt Practices Act (FCPA) and the United Nations Global Compact, help provide ethical guidelines.

Organizational Culture

Organizational culture can be changed through leadership, a young organization, and a weak existing culture.
Strategies for changing organizational culture include:
- Setting the tone through management behavior.
- Creating new stories, symbols, and rituals.
- Supporting employees in adapting to new values.
- Redesigning socialization processes.

The Difference Between Creativity and Innovation

Creativity: The ability to generate new and unique ideas.
Innovation: The process of turning creative ideas into useful products or methods.

Stress Management

Causes of stress:
- Role conflict: Experiencing conflicting expectations about one's role.
- Role ambiguity: Unclear expectations about one's role.
- Role overload: Having too much work to do in the time available.
- Task demands: Factors related to the nature of the job itself.
- Role demands: Pressures placed on an employee by the organization.
- Interpersonal demands: Pressures created by interactions with other employees.

Social obligation: Meeting economic and legal responsibilities.
Social responsiveness: Responding to societal pressures when necessary.
Social responsibility: Going beyond legal and economic obligations to contribute to society.
Views of social responsibility:
- Classical view: Businesses should focus on profit maximization and stay out of social issues.
- Socioeconomic view: Businesses should consider the needs of society and help solve social problems.

Managing Change

Why people resist change:
- Uncertainty: Fear of the unknown.
- Fear of losing position and authority: Concerns about job security or status.
- Habit: Comfort and familiarity with current procedures.
Techniques to reduce change resistance:
- Education and communication: Providing information and clarification.
- Participation: Involving employees in the change process.
- Facilitation and support: Providing assistance and guidance.
- Negotiation: Offering incentives or compromises.
- Manipulation: Using covert influence tactics.
- Coercion: Using threats or force.

Transnational Businesses

Transnational: A company that operates in many different countries, adapting to the local cultures and markets.
Why organizations go global:
- Global sourcing: Utilizing resources and labor from different countries.
- Exporting: Selling goods and services to international markets.
- Importing: Acquiring goods and services from other countries.
- Licensing: granting permission to another organization to use a brand, technology, or product.
- Franchising: Granting permission to another organization to use the business model, name, and operating methods.
- Strategic alliance: A partnership between two or more organizations to share resources and knowledge.
- Joint venture: A new organization formed by two or more partners.
- Foreign subsidiary: A fully owned subsidiary in a foreign country.

Global Challenges

Nationalism: Policies that favor national interests above global considerations.
Parochialism: The tendency to view the world solely from one's own perspective.
Globalization: The process of organizations expanding their influence across national borders.

Economic Environments

Free Market economy: Individuals and firms make decisions about production and consumption.
Planned economy: The government makes decisions regarding production and consumption.
Inflation: A general increase in the prices of goods and services.

National Culture

Values and attitudes shared by individuals from a specific country that shape their behavior and beliefs about what is important.
Based on a society's social traditions, political and economic philosophy, and legal system.
National culture has a greater effect on employees than their organization's culture.

Manager's Attitudes towards Globalization

Ethnocentric: A belief that the home country's practices are superior.
Polycentric: A belief that each country's practices are uniquely best for that country.
Geocentric: A belief that the best practices can be found anywhere in the world.

Workplace Diversity

Types of diversity:
- Age: The range of ages represented in the workforce.
- Gender: The balance of men and women in the workplace.
- Race: The representation of different racial groups in the workforce.
- Religion: The presence of differing religions in the workforce.
Benefits of diversity:
- People Management: Better use of employee talent, increased creativity in problem-solving, and better employee attraction and retention.
- Organizational Performance: Reduced costs associated with high turnover, absenteeism, and lawsuits; enhanced problem-solving abilities, and flexible systems.
- Strategic: Improved understanding of the marketplace and diverse customer needs, potential for sales growth and increased market share, competitive advantage through innovation, and improved ethical reputation.
Challenges of diversity:
- Age: Age discrimination and challenges adapting to new technology.
- Gender: Gender inequality and lack of opportunities for women.
- Race: Race and ethnicity can lead to discrimination and prejudice.
- Disabilities: Discrimination and lack of opportunities for individuals with disabilities.

Strategies for Managing Diversity

Employee Resource Groups: Voluntary employee-led groups that share common interests, identities, or goals.
Mentoring: An experienced employee provides guidance and support to a newer employee.
Diversity Training: Providing education, skills development, and awareness about different cultural perspectives.

Bias that Affect Decision Making

Bias: A preference or inclination toward a particular perspective or ideology.
Types of bias:
- Anchoring effect: Reliance on the first piece of information encountered.
- Self-serving bias: Attributing success to internal factors and failures to external factors.
- Hindsight bias: Overestimating the likelihood that an event could have been predicted.
- Overconfidence bias: Having an inflated belief in one's own abilities.
- Immediate gratification bias: Prioritizing immediate rewards over future benefits.
- Framing bias: The tendency to be influenced by the way information is presented.
- Selective perception bias: Interpreting information based on pre-existing beliefs and values.
- Representation bias: Drawing inaccurate analogies and seeing patterns that don't exist.

Cutting-Edge Approaches to Improving Decision Making

Design thinking: Approaching management problems like design problems, by considering how to redesign an object or process.
Big Data: Large and complex datasets that provide powerful insights for decision-making.
AI: Using computers to replicate human intelligence and capabilities.
Machine learning: A method of data analysis that automates the process of creating analytical models.
Deep learning: A type of machine learning that uses algorithms to create artificial neural networks, simulating the functions of the human brain.

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Description

Test your knowledge on the principles of business ethics, including ethical dilemmas and decision-making stages. Explore key concepts such as integrity, fairness, and moral development levels. This quiz will help you understand how to navigate complex ethical situations in the workplace.