COURSE NAME : ACCOUNTING & AUDITING ROLL NO. : 1070 NAME OF THE COLLEGE : MAHARSHI DAYANAND COLLEGE OF ARTS, COMMERCE & SCIENCE PAREL, MUMBAI NO.:400 012. SUBJECT : STRATEGIC MANAGEMENT PROJECT NAME : CORPORATE CULTURE AND ETHICS AND PARLE G COMPANY.
STRATEGIC MANAGEMENT MASTER OF COMMERCE ACCOUTING & AUDITING Semester 1I (2013-2014) Submitted, In partial fulfilment of the requirements for the Award of degree of master of commerce Accounting & auditing Submitted by, ASHWINI DILIPKUMAR SAWANT. ROLL NO.: 1070
Under the guidance of
MAHARSHI DAYANAND COLLEGE OF ARTS, COMMERCE & SCIENCE PAREL, MUMBAI - 400 012.
MAHARSHI DAYANAND COLLEGE OF ARTS, COMMERCE & SCIENCE PAREL, MUMBAI 400 012.
CERTIFICATE This is to certify that Ms. / Mrs. ASHWINI DILIPKUMAR SAWANT. Of M. COM Accounting & Auditing (2013- 2014) has successfully completed the Project on STRATEGIC IMPLEMENTATION & PARLE G COMPANY. Under the guidance of
Course Coordinator Principal
Project Guide / Internal Examiner
External Examiner
DECLARATION I ASHWINI DILIPKUMAR SAWANT Student of M. COM. (Accounting & Auditing) Semester 1I (2013 2014) Hereby declared that i have completed the project on CORPORATE CULTURE AND ETHICS AND PARLE G COMPANY The information submitted is true & Original to the best of my knowledge.
Signature of Student. Ashwini Dilipkumar Sawant. ROLL NO .: 1070
ACKNOWLEDGEMENT
I owe a great many thanks to a great many people who helped and supported me during the writing of this book. My deepest thanks to Lecturer, the Guide of the project for guiding and correcting various documents of mine with attention and care. He has taken pain to go through the project and make necessary correction as and when needed. I express my thanks to the Principal of, MAHARSHI DAYANAND COLLEGE OF ARTS, COMMERCE & SCIENCE, PAREL, MUMBAI NO. : 12 for extending his support. I would also thank my Institution and my faculty members without whom this project would have been a distant reality. I also extend my heartfelt thanks to my family and well wishers
INDEX
1. CONCEPT OF CORPORATE CULTURE Corporate culture is the collection of beliefs, expectation and values learned and shared by an organization's members and transmitted from one generation of employees to another. The organization's culture generally reflects the values and beliefs of the founder(s) and the mission of the firm. It gives a sense of identity to the organization's members - This is who we are. This is what we stand for. The main features of organizational culture are as follows: 1. Organizational culture is a combination of social, cultural, physical, psychological, and other conditions within an organization. 2. It influence the motivation, attitudes, behaviour and performance of the members of an organization. 3. It gives a separate identity to the organization as compared to other organizations as each organization has its own set of values, beliefs, practices customs etc. 4. The organizational culture evolves over a fairly long period of time. 5. It can be relatively stable over a period of time. However, there can be changes in the organization culture, with a change in top management, or management's philosophy. 6. It is invisible and abstract, although it is perceived and experienced by the the members of an organization. 7. Organization culture can bring name and goodwill to the organization. 8. It can provide opportunities and threats to its members.
2. CORPORATE CULTURE AND STRATEGY 1. PERSONAL VALUES AND BUSINESS ETHICS The personal values are imbibed from parents, elders, and teachers. As an individual grows, values are adapted and refined in the light of new knowledge and experiences. In an organization, values are imparted by the founder or by a dominant personality - mostly the chief executive. Such values remain for fairly a long time, even when the founder or the dominant personality is not there in the organisation Ethics specify what is good or bad, right or wrong, proper or improper from social point of view. Business ethics relates to behaviour and actions of corporations relating to business. According to Robert Gurinner "Business ethics may be defined as those principles, practices, and philosophies that are concerned with moral judgments and good conduct as they are applicable to business situation."
3. Features of Business Ethics The following are some of the important features of business ethics: 1. Ethical Values: Business ethics is concerned with morality in business. In today's world, business community forms a large part of the society and its actions (like right or wrong, legal or illegal) are bound to have a direct impact on the well being and welfare of the society. Business affects society in terms of what it does, i.e. what products is supplies. 2. Relative term: Ethics is a relative term i.e. the concept of morality and immorality differs from one individual to other or society. What is moral in one society may be immoral in other. For example, taking or giving bribe is considered as unethical in our society but may be a routine affair or just ignored by society in some other countries. 3. Interest of society: Business ethics implies that the business should do first good to the society and then to itself. Business is an important institution and has a social responsibility to protect the interest of all those groups like employees, share holders, consumers who contribute to the success of business. 4. Business society relationship: business ethics set the terms and standards to understand business society relationship. It indicates what society excepts from business and what it thinks about business. 5. Provides framework: Like an individual, business is also bound by social rules and regulations. Business is excepted to confine its activities within the limits of social, legal, cultural and economic environment. 6. Systematic study: Business ethics is a systematic study of business policies and actions that have an impact on human beings and the society. For example, a company that cares for better natural environment will pursue those plans and policies that protects environment wi ll pursue those plans and policies that protects environment. 7. Code of conduct: Business ethics, like code of conduct or professional ethics provides guidelines to regulate business activities on legal, moral, social, and ethical principles. 8. Guiding principles: business ethics are the guiding principles which helps to differentiate good or bad, right or wrong, proper or improper business decision and actions. 9. Universal application: business ethics has universal application. It is applicable to all business units in all countries whether large or small.
4. I mportance Of Business Ethics And Values The need for business ethics is more felt in recent years than over before. The following points outline the significance of business ethics. 1. Survival of business: business needs to follow ethical values for its own good and survival. A firm can have short term and quick gains by resorting to unethical means and disregarding social welfare. However, such firms grow first and are out of business faster. On the other hand, organisations doing business ethically have continued to survival and proper for a longer time. 2. Protection of consumer rights: the application of business ethics will help to confer and implement consumer rights. This will enhance the strength of individual consumer against the powerful business community. Business ethics can be used to check malpractices like adulteration, unfair trade practices and to make the working of business consumer oriented. 3. Consideration of society interest: Those firms, which follow business ethics in the society, would make every possible effort to produce goods and services not only in the interest of the consumers, but also in the interest of the society. These firms whould look into out only the customers well being, but also welfare of the society. 4. Interest of small scale industry: Business ethics is necessary to safe guard the interest of small scale business firms. The tendency of big business units is always to dominate the market and drive away the small and medium scale units from the market.
5. Better relation with the member of the society: Business ethics is needed to develop good relation between business and society. The relationship of business with society has various dimension such as its relation with shareholders, employees, consumers, distributors, competitors and government. Ethics is needed to maintain good relation among the firms on one side and between the firm and social groups on other. Business ethics will help to promote and protect the interest of various groups, associated with business activities. 6. Mutual benefit: Business ethics benefits the business firm as well as the society. The business firm that adopts business ethics get good name in the society. It may be able to increase confidence in the minds of the buyers who in turn would help to improve the sales of the firms. The society can also gain due to ethical practices on the part of the business. 7. Other Benefits: a. Business ethics will help the firm to expand and grow. b. It can motivate the employees to perform better. c. It can develop customer loyalty. d. It can help to obtain funds easily from the investors, etc.
5. IMPACT OF VALUES AND ETHICS ON CORPORATE STRATEGY The corporate strategy is greatly affected by the values, ethics, and motives of the people who are involved in its formulation process. In formulating corporate strategy, managers cannot isolate their feelings, and preferences from economic considerations. Normally, there is a tendency on the part of mangers to impose their preference and priorities in the process of strategy implementation. Corporate strategy is affected by personnel values of the chief executive and of the key executives , right from the stage of setting objectives. For instance, a chief executive with high profit orientation would give priority to those areas which generate higher rate of return while setting objectives, whereas a chief executive with high social orientation would give greater importance to social factors or areas while setting objectives. The personal values and perceptions of top executives are reflected in operational policies framed to execute the strategy. For instance, a participate leader would encourage his subordinate to take part in framing suitable policies required to implement the strategy, whereas a dominant autocratic leader would himself frame the policies and impose them on his subordinates to implement the strategy.
6. Reconciliation - The Conflict of Personal Values and Strategy There is often a conflict between personal values and rational business strategy. For strategy to be effectively implemented in the organizations there is a need for commitment and support on the part of top executives including the chief executives. Therefore, personal values and preferences of the top executives must be given considerations and a strategy based on rational considerations needs to be modified. Such a modification in the strategy would receive support from the top executives as far as its implementation is concerned, as they know that their values and preferences are in taken into account. In any organization there is a need to reconcile between the rational economic strategy and the personal values and preferences of the key executives of the organization, and also the conflict among the key executives. The conflict can be resolved by making an attempt to analyse the values and preferences of different executives and then to apprise them of such analysis so that they be may fully aware of the prejudices and biases, which influence their behaviour. Such analysis may help the executives to do way with certain values and preferences, which are not conducive for the growth of the organization. For instance, in one the organizations, a new chief executive was appointed, who was born and brought in posh environment, wanted rich interiors and exteriors of the company's head office, involving huge sum of money, was finally convinced by the finance director that such heavy spending would drain company's funds and that the company may face acute cash crunch. Reconciliation of conflicts among individual values and preferences for the formulation and implementation of strategy needs imagination, and cooperative spirit on the part of executives. They must sort out their differences, and modify their values and preferences in the interest of the organization. One of the best alternatives is to appoint an external expert to frame sound economic strategy with the support of the top executives of the organization, and the top executives should not unduly influence upon the external expert of their personal values and preferences. However, it is to be noted that if personal values and preferences are vital to the interest of the organization, then such values must considered in framing and implementing the strategy of the organization.
7. SOCIAL RESPONSIVENESS AND STRATEGIC MANAGEMENT Business is basically an economic activity, but in modem world it cannot concentrate only on profit maximization. It is a group effort, as there is participation, directly or indirectly, of the employees, customers, society, government, shareholders etc. Business can not function independently and depend on the society for supply of raw materials, capital, labour, and other requirements. Business is a part of society and has to follow and operate within the limits of the environment, and, rules and regulations prescribed by the society. There is a need to have social responsiveness in strategic management. This is because greater social responsiveness means good business. Normally the top management takes the major decisions in respect of social responsibility. The decisions in respect of social responsibility are based on the personal values, views, opinions and business ethics of the top management. Having decided to adopt social responsibility , the top management should involve social responsiveness in all the phases of implementation and strategy evaluation will be affected by social responsiveness. The strategist must consider the social responsibility towards various group in strategic management.
8. Case study ABOUT PARLE G COMPANY Parle Products has been India's largest manufacturer of biscuits and confectionery, for almost 80 years. Makers of the worlds largest selling biscuit, Parle-G, and ahost of other very popular brands, the Parle name symbolize quality, nutrition and great taste. With a reach spanning even the remotest villages of India, the company has definitely come a very long way since its inception. Many of the Parle products - biscuits or confectioneries, are market leaders in their category and have won acclaim at the Monde Selection, since 1971. With a40% share of the total biscuit market and a 15% share of the total confectionary market in India, Parle has grown to become a multi-million dollar company. While to consumers it's a beacon of faith and trust, competitors look upon Parle as an example of marketing brilliance. In 1929 a small company by the name of Parle products emerged in British dominated India. The intent was to spread joy and cheer to children and adults alike, all over the country with its sweets and candies. The company knew that it wouldnt be an easy task, but they decided to take the brave step. A small factory was set up in the suburbs of Mumbai, to manufacture sweets and toffees. A decade later it was upgraded to manufacture biscuits as well. Since then, the Parle name has grown in all directions, won international fame and has been sweetening peoples lives all over India and abroad. Apart from the factories in Mumbai and Bangalore Parle also has factories in Bahadurgarh in Haryana and Neemrana in Rajasthan, which are the largest biscuit and confectionery plants in the country. Additionally, Parle Products also has 7manufacturing units and 51 manufacturing units on every nation dreams of a better tomorrow. And every nations tomorrow lies in the hands of its children; children who make the nation proud in every aspect; the young geniuses who shape the future of the nation. So its important to nourish these young minds, for after all its a question of the nations future Filled with the goodness of milk and wheat, Parle G is a source of strength for both body and mind. Treat yourself to a packet of Parle -G to experience what has nurtured and strengthened the minds of millions of genius Indians for over 65years.It s more than just a biscuit. A meal substitute for some, a tasty and healthy snack for many others. Consumed by some for the value it offers, and many others forit s taste. Little wonder that its the Largest selling Biscuit Brand in the world. Quality Hygiene is the precursor to every process at Parle. From husking the wheat and melting the sugar to delivering the final products to the supermarkets and store shelves nationwide, care is taken at every step to ensure the best product of long -lasting freshness. Every batch of biscuits and confectioneries are thoroughly checked by expert staff, using the most modern equipment hence ensuring the same perfect quality across the nation and abroad. Concentrating on consumer tastes and preferences, the Parle b rand has grown from strength to strength ever since its inception. The factories at Bahadurgarh in Haryana and Neemrana in Rajasthan are the largest biscuit and confectionery plants in the country. The factory in Mumbai was the first to be set up, followed soon by the one in Bangalore, Karnataka. Parle Products also has 14 manufacturing units for biscuits and 5 manufacturing units for confectioneries, on contract.
9. VALUES AND ETHICS INTRODUCTION Values and ethics are central to any organization; those operating in the national security arena are no exception. What exactly do we mean by values and ethics? Both are extremely broad terms, and we need to focus in on the aspects most relevant for strategic leaders and decision makers. What we will first discuss is the distinctive nature of ethics for public officials; second, the forces which influence the ethical behavior of individuals in organizations; and third, explore the actions strategic leaders can take to build ethical climates in their organizations.
THE CHARACTER OF VALUES AND ETHICS Values can be defined as those things that are important to or valued by someone. That someone can be an individual or, collectively, an organization. One place where values are important is in relation to vision. One of the imperatives for organizational vision is that it must be based on and consistent with the organization's core values. In one example of a vision statement we'll look at later, the organization's core values - in this case, integrity, professionalism, caring, teamwork, and stewardship - were deemed important enough to be included with the statement of the organization's vision. Dr. John Johns, in an article entitled "The Ethical Dimensions of National Security," mentions honesty and loyalty as values that are the ingredients of integrity. When values are shared by all members of an organization, they are extraordinarily important tools for making judgments, assessing probable outcomes of contemplated actions, and choosing among alternatives. Perhaps more important, they put all members "on the same sheet of
music" with regard to what all members as a body consider important. The Army, in 1986, had as the theme for the year "values," and listed four organizational Values -Loyalty, duty, selfless service, and integrity-and four individual Values - Commitment, competence, candor, and courage. A Department of the Army pamphlet entitled Values: The Bedrock of Our Profession Spent some time talking about the importance of values, and included this definition: Values are what we, as a profession, judge to be right. They are more than words-they are the moral, ethical, and professional attributes of character . . . there are certain core values that must be instilled in members of the U.S.Army-civilian and uniformed soldier alike. These are not the only values that should determine our character, but they are ones that are central to our profession and should guide our lives as we serve our Nation What does "generally considered to be right" mean? All one needs to do is to look at the positive values of society and the organizations one belongs to, and what is right or wrong should be evident. There is another aspect to be considered, however, and that is the influence of societal or organizational norms. Norms are the unstated rules, usually informally reached by the members of a group, which govern the behaviour of the group's members. Norms often have a greater effect on what is and isn't done by the members of a group than formal rules and regulations. The reason norms are important for a discussion of ethics and values is that norms may allow or even encourage certain behaviour as "OK" that is not in keeping with society's or an organization's stated values. When there is a disconnect between stated and operating values, it may be difficult to determine what is "right." An example might be a company that has among its stated values to treat everyone with dignity and respect, but whose norms have permitted and perhaps even encouraged a pattern of sexual harassment over a number of years. Do those in the organization know that the behaviour is wrong, but condone it nevertheless? Is it clear to the Bosnian Serbs that ethnic cleansing is unethical and wrong, or would it fall under the mantle of behaviour that is considered to be acceptable in that society? Listen to the arguments in support of ethnic cleansing that have been made, and you will find that many of the perpetrators argued that they did nothing wrong, and were only righting previous wrongs done to them.
10. THE PUBLIC TRUST If ethics and morality are important for groups and organizations, they should also be important for public officials, and for very much the same reasons. YorkWillbern, in an article entitled "Types and Levels of Public Morality," argues for six types or levels of morality (or ethics) for public officials. By public officials, he means those who are in policy making positions in public institutions; in other words, strategic decision makers in the government, including the national security arena. The six levels he differentiates are: basic honesty and conformity to law; conflicts of interest; service orientation and procedural fairness; the ethic of democratic responsibility; the ethic of public policy determination; and the ethic of compromise and social integration. WILLBERN'S LEVEL OF PUBLIC MORALITY ETHIC OF COMPROMISE AND SOCIAL INTEGRATION ETHIC O F PUBLIC POLICY DETERMINATIO ETHIC OF DEMOCRATIC RESPONSIBILITYSERVICE ORIENTATION AND PROCEDURAL FAIRNESS CONFLICT OF INTEREST BASIC HONESTY AND CONFORMITY TO LAW
BASIC HONESTY AND CONFORMITY TO LAW. "The public servant is morally bound, just as are other persons, to tell the truth, to keep promises, to respect the person and the property of others, and to abide by the requirements of the law" (Willbern). In many ways, this level only describes the basic adherence to moral codes that is expected of all members of a group or society. There are some basics of behaviour that are expected of all if a society is to function for the collective good. For public officials, there is an additional reason why it is important to adhere to these basic moral codes and laws: they have more power than the average member of the society, and hence more opportunity for violation of those codes or laws. There also is the negative example that misconduct by public officials provides.
CONFLICT OF INTEREST. This relates to public officials, because it deals with the conflict between advancing the public interest, which a public official is charged to do, and advancing one's self-interest. The duty here is to ensure that the public interest comes first, and that one does not advance his own personal interest at the expense of the public. Willbern uses embezzlement of public funds, bribery, and contract kickbacks as examples of pursuing personal interests at the expense of those of the public. The requirements for public officials to divest themselves of investments that might be influenced by the performance of their duties (or put them in trust)and to recues themselves in situations where they have a personal interest are designed to help public officials avoid conflicts of interest. Ultimately, it still comes down to the individual making an ethical decision. Avoidance of conflict of interest is often difficult because it is often hard to separate personal and public interests, and because individuals as private citizens are encouraged to pursue private interests through any legal means. One of the areas where there is the greatest potential for conflicts of interest is where public officials deal with private organizations which are pursuing their private interests, and where any decision by a public official on allocation of resources will favour some private interest. The fields of government contracting and acquisition are two areas where the possibility of conflicts of interest is high.
11. SERVICE ORIENTATION AND PROCEDURAL FAIRNESS. This level relates closely to the last, and deals with the responsibility of public officials to ensure their actions serve the public, and that the power they wield is used only for that purpose. It is easy to abuse the power that comes with public office. Procedural safeguards are designed to prevent that abuse. The moral obligation of public servants is to follow established procedures, and not to use their power to circumvent those procedures for their own convenience or benefit. Power must be used fairly and for the benefit of the public. One can again think of examples of public officials who have violated this moral charge by using their influence and power for their own benefit or for the benefit of special interest groups, or who have circumvented established procedures for their own benefit or convenience. One frequent example is the use of government vehicles or aircraft for nonofficial business. These first three levels of public morality share one important characteristic: they all relate to the behaviour or conduct of public officials. These three levels are the areas that get most of the attention in discussions of ethics; this is where public officials are most likely to get in trouble. However, there are three additional levels of public morality equally important. These deal with the content of what public officials do, "the moral choices involved in deciding what to do, in pursuing the purposes of the state and the society" (Willbern).
THE ETHIC OF DEMOCRATIC RESPONSIBILITY Given that public officials are operating within a democratic system, they either are elected by the people or appointed by an elected official. This confers upon them the obligation to carry out the will of the people. However, public officials also have the responsibility to make moral choices consistent with their own values, and that may be in conflict with what they perceive to be the will of the people. Willbern contends that the public official acts according ng to his or her own judgment, rationalizing that it would be the will of the people if they were well enough informed on the issue. To give one example of this level of public morality, consider whether or not the representative in Congress is morally bound to support policies and legislation which his constituents overwhelmingly support but he personally opposes.
THE ETHIC OF PUBLIC POLICY DETERMINATION. This level involves the most difficult ethical choices, because it concerns making moral judgments about public policies. The responsibility is to make moral policies; the difficulty is in determining how moral a policy is. Public policies almost always deal with very complex issues, where ethical choices are rarely clear, and it is often difficult to determine if a policy is right or wrong. For example, many public policies deal with the distribution of limited resources. Is it right or wrong to slash funding for one program, or to increase funding for another? In almost any decision, there will be winners and losers, and there will be some benefit for some and cost to others. "Right" and "wrong" may not apply. Equity and fairness are important considerations, but not always easy to discern. The determination of how much funding to provide for national security, and which social programs to fund, involves ethical choices of the most difficult type. What is the difference between equality and equity? Consider the controversy around affirmative action programs: are they examples of moral public policies?
THE ETHIC OF COMPROMISE AND SOCIAL INTEGRATION. This final level deals with an area not as salient as some of the others. It deals with the necessity for compromise in a society. A society with irreconcilable differences on fundamental issues will be torn apart. Hence, it becomes amoral obligation of public officials to engage in give and take, working toward compromise in the policies they develop. One often sees legislators in our political system establishing positions where they may not get all they want from particular legislation, but will settle for some of what they want. Willbern contends that compromise, rather than standing on principle, is moral, because without compromise there will be discord and conflict, and disintegration rather than integration of the society. Public officials are given the trust of the public to develop and carry out policies that are in the public's best interest. Living up to this trust has a significant impact on the national will; public confidence is essential to the exercise of national power. Public officials have a moral duty to act in a trust worthy manner. Why, then, do individuals behave unethically? One reason is the complexity of the issues leaders deal with, and the difficulty in many instances of determining which the most ethical alternative is. There are several systemic factors. One is the competition for scarce resources. It is easy to slip into unethical acts to gain a competitive advantage in the race for position or power. A second is conflicting loyalties, which Johns labels "the most troublesome ethical dilemma facing public officials." The Iran Contra affair is a case of unethical behaviour on the part of North, Poindexter, Secord, and Mc Farlane because of misplaced loyalty to the executive chain of command. Johns also identifies systemic factors in groups and teams which can lead to unethical behaviour. One is groupthink, which can occur in a homogeneous group with a strong leader. A second is the presence of ideologues: individuals who view their own extreme positions as "right" and any opposing positions as wrong." A third is the organization's response to dissent. There are few incentives for "whistleblowers" or those who try to expose unethical behaviour in organizations. Organizational norms encourage "going along" and discourage questioning the unethical actions of others. This can quickly compromise ethical standards in any organization.
12. CAUSES OF UNETHICAL BEHAVIOR INDIVIDUAL COMPLEXITY OF STRATEGIC ISSUES OBSCURES ETHICS COMPETITIONFOR SCARCE RESOURCES/ POWER/POSITION CONFLICTING LOYALTIESGROUPGROUPTHINKPRESENCE OF IDEALOGUESNEGATIVE ORGANIZATIONAL RESPONSE TO DISSENT ETHICS IN PRACTICE Kenneth R. Andrews, in "Ethics in Practice," contends that there are three aspects to ethical behaviour in organizations: the development of the individual as an ethical person, the effect of the organization as an ethical or unethical environment, and the actions or procedures developed by the organization to encourage ethical behaviour and discourage unethical behaviour. INFLUENCES ON ETHICAL BEHAVIOR PRIOR DEVELOPMENT OF INDIVIDUAL AS ETHICAL PERSON.THE ORGANIZATION AS AN ETHICAL ENVIRONMENT.PROCEDURES THAT ENCOURAGE ETHICAL BEHAVIOR. Most of an individual's ethical development occurs before entering an organization. The influence of family, church, community, and school will determine individual values. The organization, to a large extent, is dealing with individuals whose value base has been established. This might imply that ethical organizations are those fortunate enough to bring in ethical individuals, while unethical organizations brought in unethical people. But it is not that simple. While the internalized values of individuals are important, the organization has a major impact on the behaviour of its members, and can have a positive or negative influence on their values. One example of the development of ethical individuals is the service academies. In their admissions processes, the academies attempt to get individuals of good character with the values integral to the military profession. However, the academies also recognize that their core values may be different than those prevalent in society, and they devote considerable effort to the development and internalization of their core values. As is evident from periodic breaches of integrity at the academies, e.g., cheating scandals, these attempts to instil core values do not always succeed. There are three qualities individuals must possess to make ethical decisions. The first is the ability to recognize ethical issues and to reason through the ethical consequences of decisions. The ability to see second and third order effects, one of the elements of strategic thinking, is very important. The second is the ability to look at alternative points of view, deciding what is right in a particular set of circumstances. This is similar to the ability to reframe. And the third is the ability to deal with ambiguity and uncertainty; making a decision on the best information available. ATTRIBUTES FOR ETHICAL DECISIONS SEEING SECOND- AND THIRD-ORDER CONSEQUENCES-"WARGAMING" ETHICALCONSEQUENCES OF DECISIONS SEEING ALTERNATIVE POINTS OF VIEW-REFRAMING DEALING WITH AMBIGUITY AND UNCERTAINTY-MAKING DECISIONS WITH BEST INFORMATION AVAILABLE As important as these individual characteristics are, the influence of the organization is equally important. The ethical standards that one observes in the organization will have a significant effect on individual behaviour. "People will do what they are rewarded for doing" (Andrews). The organization has its greatest impact in the standards it establishes for ethical and unethical conduct in its formal reward systems. Informal norms also have a strong influence on individuals' behaviour as do the actions of the leaders of the organization.
Strategic leaders must understand that their actions, more than words alone, will determine the operating values in the organization. The influence of the organizational context is underscored in "Why Be Honest If Honesty Doesn't Pay?" In this article, Bhide and Stevenson note that there often are no economic or other incentives to encourage ethical behaviour and discourage unethical behaviour. They contend that it most often is the dishonest individual who gets ahead, and that cases where unethical behaviour was punished are far outweighed by those in which there either were no consequences or unethical behaviour was rewarded. The Gordon Ghekkos of the world (the unethical corporate executive played by Michael Douglas in the movie "Wall Street") often get ahead, because they rarely are held to account for their actions. While these observations might lead one to a cynical view of ethics in organizations, Bhide and Stevenson come to a different conclusion. They see room for optimism despite the lack of financial gain for ethical behaviour, or the absence of negative consequences for unethical behaviour. Their reasoning is based in the fact that so many people do behave ethically, in spite of the apparent lack of gain. Ethical behaviour must be intrinsically rewarding; and most people behave ethically because it's the right thing to do. People are guided by their personal value systems. They often "choose the harder right instead of the easier wrong" specifically because of their intrinsic values of what is right. hide and Stevenson make this caveat: We should remember, however, that this...works only as long as most of us live by an honourable moral compass. Since our trust isn't grounded in self-interest, it is fragile. And, indeed, we all know of organizations, industries, and even whole societies in which trust has given way either to a destructive free-for-all or to inflexible rules and bureaucracy. Only our individual wills, our determination to do what is right, whether or not it is profitable, save us from choosing between chaos and stagnation.
13. ETHICAL RESPONSES Chaloupka, in "Ethical Responses: How to Influence One's Organization," asserts that organization members have only three choices when confronted with unethical behaviour: exit, voice, or loyalty. Exit is the most direct response: if you can't live with behaviour that does not meet your own ethical standards, leave. However, exit is not only a direct response; it is a final one, so the personal and organizational consequences must be considered. The most important personal consequences are the costs. Where do you go from there? What other options are available? How marketable are you? Can you afford the financial loss? There are specific organizational consequences as well. Will the ethics of the organization's leaders change? Will they do business with someone else who doesn't have the high standards you do? In leaving, one gives up the ability to influence the organization directly. When considering exit, one must ask, Could I have had more of an impact by remaining in the organization and trying to change it from within?" Voice This means expressing discomfort with and opposition to the observed unethical behaviour. To whom do you voice your objections? The obvious choice is your supervisor. But what if your supervisor condones the unethical behaviour, or worse, is its source? You may be jeopardizing your position, and maybe your membership in the organization. A second choice is to go to senior management. This also has potential risk. The senior leadership may be condoning or even directing the unethical behaviour. This action may bring your loyalty into question. If so, your objections may be covered up or ignored, and you may end up being forced out of the organization. On the other hand, it may be that the senior leadership is unaware of the unethical behaviour, and you may have initiated an organizational response eliminating unethical behaviour and restoring ethical standards. A third option is to go public, to engage in "whistle blowing." This is also risky, because it can lead to reprisals with negative consequences. The level of risk depends on the commitment of the organization to high ethical standards and on its willingness to encourage whistle blowing in its own best interests. Many organizations have shown commitment to ferreting out unethical individuals and maintaining high ethical standards by establishing procedures for anonymous reporting of ethical breaches and safeguards to protect whistleblowers. Exit and voice may be combined. An individual resigns in protest and goes public with his or her reasons for leaving. This leaves the individual vulnerable to the label of an employee who quit before being fired, but it also can lead to increased credibility as someone acting on conviction in spite of personal cost. Exit combined with voice is most effective if taken by someone at the upper levels of the organization. An organization can more easily ignore the "exit +voice" of a lower level employee than it can the resignation of a strategic leader, followed immediately by a press conference. The widely publicized resignation of former President Bush from the National Rifle Association over what he viewed as extreme actions is an example of exit combined with voice. It undoubtedly had a much greater effect on the NRA than the resignation of someone less well known and respected. The resignation of James Webb as Secretary of the Navy is another example of effective exit combined with voice. Loyalty The final response to unethical behaviour in an organization is loyalty. This is the alternative to exit. Instead of leaving, the individual remains and tries to change the organization from within. Loyalty thus discourages or delays exit. Loyalty also may discourage public voice, since being loyal to the organization means trying to solve problems from within without causing public embarrassment or damage. Loyalty can also encourage unethical behaviour, particularly in organizations which promote loyalty above all. These organizations discourage exit and voice, and basically want their members to" go along" with organizational practices. An interesting question is, "Can an individual be loyal to an organization by engaging in exit or voice as a response to unethical behaviour?"Chaloupka maintains that both exit and voice must exist for continued organizational effectiveness. Additionally, an organization cannot maintain high ethical standards without mechanisms for eliminating unethical behaviour. Also, loyalty is not always a virtue. Loyalty should be predicated on the organizations ethical demonstration that it is worthy of loyalty. If the organization condones unethical behaviour, it relieves the individual of any responsibility to be loyal.
BUILDING AN ETHICAL CLIMATE How can the strategic leaders of an organization build an ethical climate? Andrews suggests a number of steps that foster corporate ethics. First are the actions of the strategic leadership and the way they deal with ethical issues. The pattern of top leaders' behavior determines organizational values. A second step is to make explicit ethics policies. Ethical codes are one common example. The next step is to increase awareness of how to apply those ethical codes. Training on how to deal with situations with an ethical dimension, and how to anticipate situations that involve ethical choices, can go a long way toward ethical institutional practices. Another step to increase the salience of ethics is to expand the information system to focus on areas where ethics may come into play. Knowing what actually is going on in the organization is essential to understanding the ethical principles which govern behaviour. The information system should also support ethical behaviour, and allow the strategic leader to know when or where there are potential ethical breaches so that corrective action can be taken. The real danger is that when unethical behaviour is unnoticed, or not punished, members will assume it is condoned by the organization's leadership.
14. VALUES At the next level of culture are values .Values underlies and to a large extent determines behaviour, but they are not directly observable, as behaviours are. There may be a difference between stated and operating values. People will attribute their behaviour to stated values.
ASSUMPTIONS AND BELIEFS To really understand culture, we have to get to the deepest level, the level of Assumptions and beliefs . Schein contends that underlying assumptions grow out of values, until they become taken for granted and drop out of awareness. As the definition above states, and as the cartoon illustrates, people may be unaware of or unable to articulate the beliefs and assumptions forming their deepest level of culture. To understand culture, we must understand all three levels, a difficult task. One additional aspect complicates the study of culture: the group or cultural unit which "owns" the culture. An organization may have many different cultures or subcultures, or even no discernible dominant culture at the organizational level. Recognizing the cultural unit is essential to identifying and understanding the culture. Organizational cultures are created, maintained, or transformed by people. An organizations culture is, in part, also created and maintained by the organizations leadership. Leaders at the executive level are the principle source for the generation and re- infusion of an organization's ideology, articulation of core values and specification of norms. Organizational values Express preferences for certain behaviours or certain outcomes.
Organizational norms Express behaviours accepted by others. They are culturally acceptable ways of pursuing goals. Leaders also establish the parameters for formal lines of communication and message content-the formal interaction rules for the organization. Values and norms, once transmitted through the organization, establish the permanence of the organization's culture
15. STRATEGIC VISION A specialist was hired to develop and present a series of half-day training seminars on empowerment and team work for the managers of a large international oil company. Fifteen minutes into the first presentation, he took a headlong plunge into the trap of assumption. With great intent, he laid the ground work for what he considered the heart of empowerment-team-building, family, and community. He praised the need for energy, commitment, and passion for production. At what he thought was the appropriate time; he asked the group of 40 managers the simple question on which he was to ground his entire talk: "What is the vision of your company?" No one raised a hand. The speaker thought they might be shy, so he gently encouraged them. The room grew deadly silent. Everyone was looking at everyone else, and he had as inking sensation in his stomach. "Your company does have a vision, doesn't it?" he asked. A few people shrugged, and a few shook their heads. He was dumbfounded. How could any group or individual strive toward greatness and mastery without a vision? That's exactly the point. They can't. They can maintain, they can survive; but they can't expect to achieve greatness.
CORE BELIEFS AND VALUES Just as they underlie organizational culture, beliefs and values are a critical part of guiding philosophy and therefore vision. One CEO expressed the importance of core values and beliefs this way: I firmly believe that any organization, in order to survive and achieve success, must have a sound set of beliefs on which it premises all its policies and actions. Next, I believe that the most important single factor in corporate success is faithful adherence to those beliefs. And, finally, I believe [the organization] must be willing to change everything about itself except those beliefs as it moves through corporate life. (Collins and Porras 1991)Core values and beliefs can relate to different constituents such as customers, employees, and shareholders, to the organization's goals, to ethical conduct, or to the organization's management and leadership philosophy. Baxter Healthcare Corporation has articulated three Shared Values: Respect for their Employees, Responsiveness to their Customers, and Results for their Shareholders the has been studied from the point to point view of Parle biscuits; mainly Parle-G and Parle Hide & Seek.
16. PARLE G THE EVOLUTION Has been a strong household name across India. The great taste, high nutrition, And the international quality makes Parleg a winner. No wonder, its theundisputed leader in the biscuit category for decades. It is consumed by people of all ages, from the rich to the poor, living in cities & in villages. While some have it for breakfast, for others it is a complete wholesome meal. For some its the best accompaniment for chai, while for some its a way of getting charged whenever they are low on energy. Because of this, Parle-G is the worlds largest selling brand of biscuits. Launched in the year 1939, it was one of the first brands of Parle products. It was called Parle Glucose Biscuits mainly to cute that it was a glucose biscuit. It was manufactured at the Mumbai factory, Vile Parle and sold in units of half and quarter pound packs.
Functional Departments of the Organization 1. Marketing Department 2. Finance Department 3. HR & Personnel Department 4. Production Department 5. Engineering Department 6. Quality Department 7. R & D Department 8. Sales & Dispatch Department
17. Growth and Development of The Organization Over the years, Parle has grown to become a multi-million US Dollar company. Today, Parle enjoys a 40% share of the total biscuit market and a 15% share of the total confectionary market, in India. The Parle Biscuit brands, such as, Parle-G, Monaco and Krackjack and confectionery brands, such as, Melody, Poppins, Mango bite and Kismi, enjoy a strong imagery and appeal amongst consumers. Then the Parle representatives includes the production officer and the operationshead made students exposed to the production unit followed by themanufacturin g unit and packaging. The extensive distribution network, built over the years, is a major strength for Parle Products. Parle biscuits & sweets are available to consumers, even in the most remote places and in the smallest of villages with a population of just 500.The Parle marketing philosophy emphasizes catering to the masses. Weconstantly endeavour at designing products that provide nutrition & fun to the common man. Most Parle offerings are in the low & mid-range price segments. Thisisbasedonour cultivated understanding of the Indian consumer psyche. The value-for- money positioning helps generate large sales volumes for the products. However, Parle Products also manufactures a variety of premium products for the up-market, urban consumers. And in this way, caters a range of products to a variety of consumers. In nutshell, the Parle name conjures up fond memories across the length and breadth of the country.
18. Market profile of the organisation Its a brand that has held its price line at Rs 4 for 25 years now -- the price was last raised in 1994 by 25 paise. So, it's not for nothing that Parle-G is the worlds largest-selling biscuit by volumes. Parle is, of course, not doing it for charity. Soaring input prices meant it opted for reducing the weight of the biscuit than increasing the price -- first from 100 gm to 92.5 gm in January 2008, and then to88 gm in January this year -- in line with other biscuit-makers and FMCG players. It has 1600 crore turnover. Parle-G enjoys close to 70 per cent market share in the glucose biscuit category and probably has the deepest reach. It reaches 2.5 million outlets, including villages with a population of 500 people, on a par with Unilever's Lifebuoy, ITC'scigarettes or mobile prepaid cards. It reaches 2.5 million outlets, includingvillages with a population of 500 people, on a par with Unilever's Lifebuoy, ITC'scigarettes or mobile pre-paid cards. It's also one of the few FMCG brands in thecountry, whose customers straddle across income segments. The brand isestimated to be worth over Rs 2,000 crore (Rs 20 billion), and contributes morethan 50 per cent of the company's turnover (Parle Products is an unlist edcompany and its executives are not comfortable disclosing exact numbers). Last fiscal, Parle had sales of Rs 3,500 crore (Rs 35 billion).Competition has, of course, been trying to wean away customers from Parle.Britannia relaunched its Glucose-D biscuit as Tiger in 1995 and boasts of 17-18per cent share, while ITC's Sun feast glucose has captured 8- 9 per cent,according to industry sources. Even Levers had forayed into this segment in 2003and launched a glucose biscuit branded as Modern, after it acquired the bakerybusiness of Modern. There are strong regional brands, including Priya Gold (west), Cremica (north) and Anmol (east)
19. CONCLUSION Employee Engagement is the buzz word term for employeecommunication. It is a positive a ttitude held by the employeestowards the organization and its values. It is rapidly gaining popularity, use and importance in the workplace and impacts Organizations in many ways. Employee engagement emphasizes the importance of employee communication on the success of a business. An organization should thus recognize employees, more than any other variable, as powerful contributors to a company's competitive Position. Therefore employee engagement should be a continuous process of learning, improvement, measurement and action. We would hence conclude that raising and maintaining employee engagement lies in the hands of an organization and requires a perfect blend of time, effort, commitment and investment to craft a successful endeavour. Employee engagement is the sum total of the work place behaviour demonstrated by the people. Such behaviour is characterized by: 1. Belief in the organization 2. Drive to work to make things better 3. Understanding of business context 4. Respect and support for others 5. Desire to learn new skills. The level of employee engagement affects key results such as sales, customer satisfaction, and innovation and employee turnover. An engaged workforce is capable of delivering sustained differentiation and a significant competitive advantage.
Hilgers, Tina - MacDonald, Laura - Violence in Latin America and The Caribbean - Subnational Structures, Institutions, and Clientelistic Networks-Cambridge U PDF