Transcript Chap003
3-1
McGraw-Hill/Irwin
Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
3-2
Chapter
3
Social, Ethical, and Legal
Issues in Selling
McGraw-Hill/Irwin
Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
3-3
Chapter
3
Management’s Social Responsibilities
What Influences Ethical Behavior
Management’s Ethical Responsibilities
Ethics in Dealing with Salespeople
Salespeople’s Ethics when Dealing with Their Employers
Ethics in Dealing with Customers
The International Side of Ethics
Managing Sales Ethics
McGraw-Hill/Irwin
Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Management’s Social
Responsibilities
3-4
Social responsibility is
management’s obligation
to make choices and take
actions that contribute to
the welfare and interests
of society as well as to
those of the organization
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Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
3-5
Organizational Stakeholders
A stakeholder is any group within or outside the organization
that has a stake in the organization’s performance
Each stakeholder has a different interest in the organization
Customers
Owners
Community
Creditors
Managers
Employees
Government
Suppliers
CCC GOMES
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Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
An Organization’s Main
Responsibilities
3-6
Economic--be profitable
Legal--obey the law
Ethical--do what is right
Discretionary--contribute
to community & quality
of life
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Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
3-7
What Influences Ethical Behavior?
The Individual’s Role
Level one: Preconventional--acts in own best interest
A few operate here
Level two: Conventional--upholds legal laws
Most people operate here
Level three: Principled--lives by own code
Less than 20% reach level three
The Organization’s Role
At best, most employees in firm operate at level two
How will handle situation if no policies and procedures?
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Management’s Ethical
Responsibilities
3-8
Ethics is the code of moral principles and values that
govern the behaviors of a person or a group with
respect to what is right or wrong
Ethics sets standards as to what is good or bad in
conduct and decision making
Ethical behavior refers to treating others fairly
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3-9
What is an Ethical Dilemma?
A situation in which each alternative choice or
behavior has some undesirable elements due to
potentially negative ethical or personal
consequences
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3-10
Ethics in Dealing with Salespeople
Five ethical considerations faced by sales managers
Level of sales pressure
Decisions affecting territory
To tell the truth?
The ill salesperson
Employee rights
termination-at-will
privacy
sexual harassment
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Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Salespeople’s Ethics in Dealing
with Their Employers
3-11
Misusing company assets
Moonlighting
Cheating
Affecting other salespeople
Technology theft
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Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
3-12
Ethics in Dealing with Customers
Bribes
Misrepresentation
Price discrimination
Robinson-Patman Act
Selling the same quantity of the same product to
different buyers at different prices
Tie-in sales
To buy a particular line of merchandise, a buyer may
be required to buy other, unwanted products
Clayton Act
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3-13
Ethics in Dealing with Customers
Exclusive dealership
Reciprocity
Buying a product from
someone if the person or
organization agrees to
buy from you
Sales restrictions
Cooling-off laws
Green River ordinances
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3-14
The International Side of Ethics
Guidelines for conducting international business
may be different or even nonexistent
It is important to keep up to date on the law and be
aware of how authorized representatives are
conducting business
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3-15
Managing Sales Ethics
Follow the organization’s leader
Leader selection is important
Establish a code of ethics
Create ethical structures
Encourage whistle-blowing
Create an ethical sales climate
Establish control systems
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3-16
Summary of Major Selling Issues
Ethical behavior pertains to values of right and
wrong
Ethical decisions and behavior are typically guided
by a value system
An important individual characteristic is one’s level of
moral development
Corporate culture is an organizational characteristic
that influences ethical behavior
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Summary of Major Selling Issues
cont…
3-17
Social responsibility in business means profitably
serving employees and customers in an ethical and
lawful manner
Ethical standards and guidelines for sales personnel
must be developed, supported, and policed
Research suggests that socially responsible
organizations perform as well as – and often better
than – organizations that are not socially responsible
McGraw-Hill/Irwin
Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.