Analysis and Issues When the senior-level women at Vision resigned, it seems from the information in Lie’s memo that people assumed that they were choosing Emily over a career and therefore, management believed there was nothing that the company could have done to retain these women. However, these women may have left for better opportunities, potentially with competitors. Vision’s obvious costs of losing these employees include the loss of investment made in recruiting and training them as well as the cost of recruiting and training their replacements.
Yet, the hidden cost of employee turnover is possibly even more devastating. These hidden costs include the loss of intellectual capital and the potential for the former employee to come a competitor; potential disruption in the. General Electric and its river pollution problems; GE and Westinghouse antitrust action in turbines; Walter’s aggressive growth strategy and the loss of small town businesses; Wall-Mart and its labor and legal practices; and Wall- Mart with its “Buy America Program. Now here comes Enron, Arthur Andersen, Global Crossing, Tycoon, Martha Stewart, Disney (remember its privacy practices and guest safety issues), Delphic, Rite Aid, Nordstrom, the dot com bubble, Xerox and its large restatement of earnings, ditto Lucent, ND who could forget Crispy Cream donuts? There is a point here. Bad ethics isn’t necessarily new, but there does seem to be more problems that are even bigger today than yesterday. These issues can be national news, but they can also permeate even small organizations, causing irreparable harm.
This is where sound human resource (HER) development and systems become important so that HER leaders can strategically support the organization for the good of the organization itself. There is a fundamental reality that seems to have escaped our notice: Ethical issues are important, and ethical locations are not all that uncommon. Think about your own encounters with rude sales people, telephone service sales solicitations, product defects, and other day-to-day encounters. Much of this does not make it to the nightly news, but ethical transgressions are quite common in today’s society.
Think about your work life. Does senior management truly respect you and your co- workers? Who gets blamed when problems arise? Are you surprised when important decisions are announced? Are you involved in discussions about strategically important problems, opportunities and questions? Ethics do not serially involve the big transgression all of the time. They can be the result of hidden forces that many times we don’t even see. They are so common that we often take them for granted, almost.
How often do we take action and don’t even think that there is an ethical point to consider? Ethical issues in the workplace are often invisible. Publicly there is general consensus that managers should not violate laws. After the summer of 2002, it should be pretty clear that it makes no sense to knowingly break the law. Obviously, the executives at Arthur Andersen were foolish to shred those documents and he chief accountants at MIMIC World were wrong to book current period expenses as capitalized assets.
Certainly, Enron’s income recognition problems and off-balance sheet “Special Purpose Entities” was clearly inappropriate-?as was their loans and dealings outside the United States. The answer to those that participated Was a resounding “no”. In all cases, the managers involved made a case that they “believed” their actions and “ethics” were within current social standards. These people share they didn’t “knowingly” cross the line. Have you experienced people in your career and organization that would say the same?
One could argue that the fundamental mistake by the above executives was getting too close to a line that isn’t clearly visible, even moves over time. Golden State Fence and Koch Foods may argue that they were not aware of those people working for them were brought in without valid right-to-work documents. However those employees at Citreous, LASS, MM, 24 Hour Fitness, Sears, Irritate, Cutbacks, Emery’s, Farmers Insurance, Longs Drugs, arguing for overtime wages after finding out they were misclassified as a “salaried” exempt employee do indeed “get it! ”