What they say or write often lacks any meaning at all. The former high-riding Enron Chief Executive Officer, Jeffrey Skilling , was convicted of federal felony charges fraud, insider trading, etc.
Appeals have reduced his sentence and he may be released this year. The question that leaders should consider is whether the lessons learned from this sad chapter in American corporate business will actually stick. Values Respect: We treat others as we would like to be treated ourselves. We do not tolerate abusive or disrespectful treatment. Ruthlessness, callousness and arrogance don't belong here. Integrity : We work with customers and prospects openly, honestly and sincerely.
When we say we will do something, we will do it; when we say we cannot or will not do something, then we won't do it. Communication : We have an obligation to communicate.
We believe that information is meant to move and that information moves people. Excellence : We are satisfied with nothing less than the very best in everything we do. We will continue to raise the bar for everyone. The great fun here will be for all of us to discover just how good we can really be. Few people actually limit their speed to the 55 or 65 miles per hour posted on highway signs. In organizations, employees often decide how to act not based upon an ethical statement on the company intranet or in a policy manual, but by how they see others acting.
Incidents of unethical behavior, therefore, often are partially explained by organizational culture Sinclair, These incidents help to explain the behavior but also help to shape a culture that influences future incidents, thus creating a cycle of unethical behavior. Wimbush, Shepard and Markham examined the link between ethical climate and integrity. The researchers surveyed employees in a national retail, sales-commissioned organization. Factor analysis determined five factors or types of ethical climate — independence, caring, instrumental law, rules, and service.
The WSQ presents four ethical vignettes derived from newspaper reports of actual ethical situations experienced by business organizations. The four ethical dilemmas covered stealing, lying, disobeying company policies, and serving as an accomplice.
Regression analysis was performed for each of the five dimensions and for each of the four dependent variables. Overall, the presence of ethical climate was negatively related to unethical behavior Wimbush, Shepard, and Markham, Most regressions were negative and significant See Table 1 for full summary.
Five nonsignificant negative relationships and three nonsignificant positive relationships were discovered. The only positive, significant relationship was founded between instrumental climate and serving as an accomplice all of the relationships for instrumental climate were positive, though the remaining were nonsignificant.
Instrumental climates are marked by employees expected to sacrifice work and personal morals for the good of the company Victor and Cullen, An organization that has shaped an ethical climate and culture should be less likely to house unethical behaviors.
Schein outlines five primary behaviors that serve as mechanisms leaders use to create and reinforce organizational culture:. Enron was founded in in Omaha, Nebraska as a natural gas provider, but was reorganized in to function as a holding company BBC News, n. However, several examples reveal that the culture stood opposed to these core values. Instead of reinforcing the code of ethics and the list of virtuous core values, the actions of leadership established a culture with values of greed and pride.
These actions undoubtedly helped shape the culture of Enron. Taking these two examples into consideration, it becomes clear why reports of unethical behavior were seen at all levels. Despite public awareness about the dangers of this behavior, no one came forth to speak out against it.
While senior leadership worked to create a statement of core values that upheld the highest ethical standards, their actions shaped a culture that would not meet these standards. However, this attention is well deserved, as Zappos is considered by many to be a shining example of customer service, culture, and ethics Chafkin, Zappos was founded in It has since expanded its product offerings to clothing, accessories, and even various overstocked merchandise through its subsidiary companies Hsieh, Compared to Enron, the company is small, employing approximately 2, people at its headquarters in Las Vegas, Nevada and in its warehouse in Kentucky.
Zappos does not just differ in size; it differs drastically in its business paradigm as well. The company places its emphasis on developing its culture and core values around the happiness of both its employees and its customers Hsieh, It is surprising to learn that the company lacked a formal statement of core values for the first six years of its existence Hsieh, Hsieh was familiar with the offsite retreat homework assignment used by most corporations and did not want to draft a document that failed to reflect the true culture of his employees.
Instead, Tony focused first on creating a dignified company culture: one that was committed to exceptional customer experiences Hsieh, Hsieh even reinforced this culture by drafting a book of essays about company cultures comprised entirely of employee contributions Chafkin, Zappos eventually developed training programs designed to reinforce this internal framework Hsieh, Hsieh has even gone so far as to offer to pay employees to quit if they are not a cultural fit Taylor, It was Zappos employees who eventually persuaded Hsieh that they needed a statement of values to represent the Zappos environment Hseih, Instead of taking his senior executives off-site to prepare such a statement, Hsieh borrowed the strategy used to create the culture book.
Hsieh emailed everyone in the company, asking for their input on what they believed were the core values of Zappos Chafkin, Then, like a gardener tending to plants, he pruned and watered certain ideas, combining similar values and expanding on others Hseih, Finally, they settled on ten core values, which remain unchanged even today:.
We believe that information is meant to move and that information moves people. We will continue to raise the bar for everyone. The great fun here will be for all of us to discover just how good we can really be. We are convinced that consumer choice and competition lead to lower prices and innovation. That's why we employ the best and the brightest people. And we believe that every employee can make a difference here. It calls for new insights, new ways of looking at problems and opportunities, and a strong sense of urgency.
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