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This is to certify that the

thesis entitled

AN EXPLORATORY STUDY OF THE ETHICAL PERCEPTIONS OF
MIDDLE AND LOWER LEVEL MANAGERS AND THE INFLUENCE
OF NON-TECHNICAL VARIABLES ON THEIR DECISIONS

presented by

Raymond James Shuster

has been accepted towards fulfillment
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ABSTRACT

AN EXPLORATORY STUDY OF THE ETHICAL PERCEPTIONS OF
MIDDLE AND LOWER LEVEL MANAGERS AND THE INFLUENCE
OF NON-TECHNICAL VARIABLES ON THEIR DECISIONS

BY

Raymond James Shuster

The purpose of this study is to investigate the
ethical dimension of business problems and the attitudes
and behavior of managers in dealing with such problems. It
examines the ethical perceptions of middle and lower level
managers and the effects of non-technical and non-economic
influences on their decisions, and how such decisions are
affected by the manager's organizational orientation--his
perceptions of his role and relationships in the firm.

The research instrument is tested as a descriptive/
diagnostic/predictive device for analyzing the ethical
quality of the manager's decisions. A test is made of the
feasibility of making logical analyses of the ethical con-
tent of problem solutions and of a rational means of come
paring the decision choices of men holding various organi-
zational positions in the same hypothetical problem situa-
tion. The four-part questionnaire provided data on the

manager's personal characteristics; his rating of eighteen

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Raymond James Shuster

influences categorized as to authority/organization/self-
orientation; his perception of his environment and status
in his firm; and his action choices or Opinions relative to
six ethical problem situations. His perception of influ-
ences operative in these concrete problems are compared
with those he had rated in the abstract.

The sample is comprised of one hundred and one
management level personnel, seventy-three from firms in one
industry, and twenty—eight from smaller business who have a
strong religious orientation. They are further stratified
into five functional areas and five organizational levels.
Comparisons are made between the groups and among the areas
and levels.

The data yielded support for the following five of
seven hypotheses:

l. The individual manager will tend to view himself
as more ethical than other managers.

2. Managers engaged in some business functions will,
as a whole, have significantly different per-
ceptions of the solution possibilities of ethical
problems from managers in certain other functions.

4. Managers engaged in some business functions will,
as a whole, reflect different proportions of
prudence vs justice in their ethical problem
solutions from managers in certain other functions.

5. Managers engaged in some business functions will,
as a whole, have significantly different per-
ceptions of the relative importance of non-technical
influences which may affect their decisions in
ethical problems from managers in certain other
functions.

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Raymond James Shuster

6. The more religious manager will be more concerned
about the interests of others and less concerned
with self-interest than the less religious manager.
The evidence was inconclusive as to the following

two hypotheses:

3. There will be significant differences in the per-
ceptions of the solution possibilities of ethical
problems between managers from one organizational
level and those from certain other organizational
levels--the higher the level, the more complete
the solution.

7. The perceptions of organizational climate held by
managers in one function will differ significantly
from those held by managers in certain other
functions.

Nevertheless, it is felt that these latter two

hypotheses are important and warrant further exploration.

The personal, influential, and environmental
characteristics of the managers were examined in order to
identify variables which might help to explain differences
in their ethical perceptions. Age, religious interests,
and personal goals strongly differentiated the two groups,
as did several of the influences-—chiefly Own Religious
Beliefs, Customer/Supplier Welfare, and Own Career Aspir-
ations, and they had a different rank ordering of the
influences identified with authority, organization, and
self. These differences were considerably modified in
the context of functional area and organizational level.
Certain environmental variables were also distinctive. A
number of correlation tests were attempted, but the results

were inconclusive.

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The major conclusion is that the organizational
orientation of the managers does tend to influence their
ethical decisions, chiefly due to: functional bias,
differences in technical comprehension of the issues in-
volved, variances in the relative prOportions of prudence
and justice they reflect in their decision choices, and
differences in the relative significance they attribute to
the influences they perceive to be operative in problem
.situations.

The major recommendation is that, since the
approach taken in this study appears to have diagnostic
and predictive possibilities, it could be refined for use-
ful application on a practical basis within individual
industrial organizations for the purpose of improving the
ethical content and quality of their managerial decisions.
The manager is seen as being sensitive to the ethical
implications in problem situations, but he can be assisted
by a practical framework of ethical criteria and by
positive support from top management in maintaining the
highest possible standard of ethics in his business

decisions.

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Ce:

AN EXPLORATORY STUDY OF THE ETHICAL PERCEPTIONS OF
MIDDLE AND LOWER LEVEL MANAGERS AND THE INFLUENCE

OF NON-TECHNICAL VARIABLES ON THEIR DECISIONS

BY

Raymond James Shuster

A THESIS

Submitted to
Michigan State University
inpartial fulfillment of the requirements
for the degree of

DOCTOR OF PHILOSOPHY

Department of Management

1971

(c) Copyright by
RAYMOND JAMES SHUSTER

1971

This researc:

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ACKNOWLEDGMENTS

This researcher's interest in the problems of busi-
ness ethics developed during many years in industry. A
simple criterion, "the right way is the best way," has been
a dependable guide which came out of the counsel of his
earliest mentor in the business world, Lester E. Elwood.
Another who encouraged along the way is Dr. Bruce E.
DeSpelder, of Wayne State University's School of Business.
Special thanks are due Dr. Spencer A. Larsen,
Director of Wayne's AMTC activity, and to his industrial
faculty, as well as to the members of the Christian Busi-
ness Men's Committee, who participated in the survey.
Grateful recognition is given the chairman of my
dissertation committee, Dr. Rollin H. Simonds, and to the
members, Dr. Dalton E. McFarland, and Dr. Robert V.
Penfield, for their advice and guidance in difficult times.
The capable assistance of Mr. John Teeter with the
computer work, and Mrs. Carolyn Piersma in the typing and
editing, is greatly appreciated, as was the counsel of Dr.

Frank R. Bacon and Dr. James A. Stapleton on statistics.

ii

“2-1 a"..- .wa‘iam

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if: H‘ro}

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.:.a.;'.es, and tars:

 

Most of all I thank my patient and hardworking
wife, Martha, for her unfailing support, and my children,
relatives, and many friends for their encouragement and

prayers.

iii

 

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TABLE OF CONTENTS

Chapter
I. INTRODUCTION AND HYPOTHESES .
Purpose of the Research .

The General Problem. . .
The Approach to the Study.

Specific Problems, Hypotheses,

Questions . . . . . .

Hypothesis 1 . . . .
Hypothesis 2 . . . .
Hypothesis 3 . . . .
Hypothesis 4 . . . .
Hypothesis 5 . . . .
Hypothesis 6 . . . .
Hypothesis 7 . . . .

5

Other Related Question

Problems of Definition and Application of

Ethics . . . . . . .

Review of Related Research and Literature

Conclusion. . . . . .
II. DESIGN OF THE RESEARCH. . .

The Population and Samples

The Survey Instrument--General

Description . . . .
Plan for Data Compilation
Validation. . . . . .
The Questionnaire and Instru
Tables and Tests. . . .

III. FINDINGS: PERSONAL, INFLUENTIAL AND ENVIRON-

MENTAL VARIABLES. . . . .

Introduction . . . . .

1. Findings: Personal Profile Variables

Summary of Section 1 .

iv

and Stat

ctions.

istical

Page

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12
24
30
33
33
37
38
40
46
47

47
48

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2. Findings: Influential Variables . . 74
Summary of Section 2 . . . . . . 92
3. Findings: Environmental Variables . 93
Summary of Section 3 . . . . . . 122
IV. FINDINGS: CASE PROBLEMS AND RELATED INFLU-

ENCES. . . . . . . . . . . . . . 125
Introduction . . . . . . . . . . 125
Framework of Ethical Criteria . . . . 128
The Solution Rating Scale. . . 128
Evaluation of Ethical Content and Quality 132
Case Problem 1, Preliminary Analysis . . 134
Case Problem 2, Preliminary Analysis . . 138
Case Problem 3, Preliminary Analysis . . 143
Case Problem 4, Preliminary Analysis . . 146
Case Problem 5, Preliminary Analysis . . 149
Case Problem 6, Preliminary Analysis . . 151
Rating the Action Choice Patterns for
Each Case . . . . . . . . . . . 156

Case Problem 1 . . . . . . . . 159
Case Problem 2 . . . . . . . . 164
Case Problem 3 . . . . . . . . 172
Case Problem 4 . . . . . . . . 175
Case Problem 5 . . . . . . . . 187
Case Problem 6 . . . . . . . . 191
Evaluating the Case Problems for Ethical
Content and Quality. . . . . 193
Preliminary Summary of Case Problems . . 198
Influences Perceived in All Case Problems 202
Summary of Findings--Case Problems and
Related Influences . . . . . . . . 218
V. SUMMARY, CONCLUSIONS, AND RECOMMENDATIONS. . 219
Introduction . . . . . . . . . . 219
Summary of Findings. . . . . . . . 220
Hypothesis 1 . . . . . . . . . 220
HYPOthesj-s 2 O 0 O O I O O O O 221
Hypothesis 3 . . . . . . . . . 222
Hypothesis 4 . . . . . . . . . 222
Hypothesis 5 . . . . . . . . . 224
Hypothesis 6 . . . . . . . . . 225

 

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Hypothesis 7 . . . . . . . . . 226
Other Findings . . . . . . . . 227
Conclusions . . . . . . . . . . 234
Recommendations . . . . . . . . . 239
BIBLIOGRAPHY . . . . . . . . . . . . . 242
APPENDICES
Appendix
A. Composition of Ethical Content and Quality
of Case Problem Action Choices . . . . . 252
B. Description and History of Group 2 . . . 256
C. Description of the Pilot Study . . . . . 261
D. Final Form of the Questionnaire. . . . . 266
E. Statistical Procedures. . . . . . . . 276

F. Detail of Case Problem Action Choices
Before Consolidation . . . . . . . . 280

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LIST OF TABLES

Table Page

1. Age--Distribution by Major Groups, Functional
Areas, and Organizational Levels (N=101) . 50

2. Education, College-Distribution by Major
Groups, Functional Areas, and Organiza-
tional Levels (N=101) . . . . . . . 52

3. Education, Degrees-Distribution by Major
Groups, Functional Areas, and Organiza-
tional Levels (N=101) . . . . . . . 53

4. Education, Major-Distribution by Major
Groups, Functional Areas, and Organiza-
tional Levels (N=101) . . . . . . . 55

5. Religion, Denomination-Distribution by
Major Groups, Functional Areas, and
Organizational Levels (N=101). . . . . 57

6. Religion, Position-Distribution by Major
Groups, Functional Areas, and Organiza-
tional Levels (N=101) . . . . . . . 58

7. Religion, Importance-Distribution by Major
Groups, Functional Areas, and Organiza-
tional Levels (N=101) . . . . . . . 60

8. Fraternal/Professional Membership-Distrib-
ution by Major Groups, Functional Areas,
and Organizational Levels (N=101) . . . 61

9. Parent's Education-Distribution by Major
Groups, Functional Areas, and Organiza-
tional Levels (N=101) . . . . . . . 63

10. Personal Activities/Interests/Goals-Distrib-
ution by Major Groups (N=101). . . . . 65

vii

 

 

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12.

213.

14!.

15.

165.

137

18

19

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21.

22.

Personal Activities/Interests/Goals—Distrib-
ution by Functional Areas (N=101), Both
Groups . . . . . . . . . . . .

Personal Activities/Interests/Goals-Distrib-
ution by Organizational Level (N=101),
Both Groups . . . . . . . . . .

Personal Activities/Interests/Goals-Distrib-
uted by Functional Areas (N=73), Group 1
only. I O O O O O O O C O O 0

Personal Activities/Interests/Goals-Distrib-
uted by Organizational Level (N=73),
Group 1 Only . . . . . . . . . .

Personal Activities, Interests, Goals-
Distributed by Functional Areas and
Organizational Levels, Group 2 Only
(N=28) O I O O O O O O O O O O

Studied Religion, Ethics, Logic, Psychology-
Distribution by Major Groups, Functional
Areas, and Organizational Levels (N=101).

Studied Religion, Ethics, Logic, Psychology-
Distribution by Functional Areas and
Organizational Levels, Group 1 Only
(N=73) o o o o o o o o o o o o

Influences-Ratings in Weighted Means and
Medians, Rankings, and A-O-S Orien-
tations-Major Groups . . . . . . .

Influences-Ratings in Weighted Means, and
Rankings-Functional Areas. . . . . .

Influences-Ratings in Weighted Means, and
Rankings-Organizational Levels . . . .

Influences-Ratings in Weighted Means, Rank-
ings-Group 2 by Functional Area and
Organizational Level . . . . . . .

Authority/Organization/Self-Orientation, by
Major Groups, Functional Areas, and
Organizational Levels for Both (N=101)
and (N=73). . . . . . . . . . .

viii

Page

66

67

68

69

7O

72

73

77

78

81

83

90

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34

35.

General Functional Area and Organizational
Area of Respondents by Groups . . . .

Specific Functions of Respondents, by Major
Groups, Functional Areas, and Organiza-
tional Levels for (N=101) . . . . .

Specific Functions of Respondents, Group 1,
by Functional Areas, and Organizational
Levels (N=73) . . . . . . . . .

Specific Functions of Respondents, Group 2,
by Functional Areas and Organizational
Levels (N=28) . . . . . . . . .

Subordinates Reporting Direct to Respondent

by Groups, Functional Areas, and Organiza-

tional Levels . . . . . . . . .

Number of Employees in Respondents' Company

or Division, by Groups, Functional Areas,

and Organizational Levels . . . . .

Earnings of Respondents, by Groups, Functional

Areas, Organizational Levels . . . .

Perceived Attitudes Toward Ethical Problems,
by Groups, Functional Areas, Organizational

Levels, for (N=101) . . . . . . .

Perceived Attitudes Toward Ethical Problems,
by Functional Areas, Organization Levels,

for Group 1 (N=73) . . . . . . .

Perceived Situation in Company, by Groups,
Functional Areas, Organizational Levels,
for (N=101) . . . . . . . . . .

Perceived Situation in Company, by Functional
Areas, Organizational Levels, for Group 1

(N=73). . . . . . . . . . . .

Perceived Company Goals, by Major Groups
(N=101) o o o o o o o o o o o

Perceived Company Goals, by Functional Areas

(N=101) . . . . . . . . . . .

ix

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101

103

105

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109

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113

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Perceived Company Goals, by Organizational
Levels, for (N=101) . . . . . . .

Perceived Company Goals, by Functional Areas,

for (N=73) Group 1 Only. . . . . .

Perceived Company Goals, by Organizational
Levels, for (N=73) Group 1 Only . . .

Perceived Status of Businessmen's Ethics, by

Group, Functional Areas, Organizational
Levels . . . . . . . . . . .

Case Problem 1, Action Choices, by Groups,
Functional Areas, Organizational Levels,
for (N=101) and (N=73) . . . . . .

Case Problem 2, Action Choices, by Groups,
Functional Areas, Organizational Levels,
for (N=101) and (N=73) . . . . . .

Case Problem 3, Action Choices, by Groups,
Functional Areas, Organizational Levels,
for (N=101) and (N=73) . . . . . .

Case Problem 4, Action Choices, by Groups,
Functional Areas, Organizational Levels,
for (N=101) and (N=73) . . . . . .

Case Problem 5, Opinion Choices, by Groups,
Functional Areas, Organizational Levels,
for (N=101) and (N=73) . . . . . .

Case Problem 6, Opinion Choices, by Groups,
Functional Areas, Organizational Levels,
for (N=101) and (N=73) . . . . . .

Case Problem l--Ana1ysis per Objective/Sub-
jective Modes, for Groups, Areas, and
Levels 0 O O O O O O O O O 0

Case Problems--Objective vs Subjective Mode
Total, by Functional Areas and Organiza-
tional Levels . . . . . . . . .

Case Problems--Objective vs Subjective Mode,

Group 1, by Functional Areas and Organiza-

tional Levels . . . . . . . . .

Page

119

120

121

123

139

142

145

148

152

155

163

169

170

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Table Page

49. Case Problems--Objective vs Subjective Mode,
Group 2, by Functional Areas and Organiza-
tional Levels 0 O O O O O O O C O 171

50. Consolidated Case Problems--Objective vs Sub-
jective Mode, by Groups, Functional Areas,
Organizational Levels . . . . . . . 180

51. Comparative Summary of Case Problems 1 - 4
by Solution Rating, by GrOups, Functional
Areas, and Organizational Levels. . . . 184

52. Comparative Summary of Case Problems 5 - 6
by Solution Rating, by Groups, Functional
Areas, and Organizational Levels. . . . 189

5:3. Ethical Quality of Case Problem Action
Choices--Prudence vs Justice . . . . . 195

54 . Influences Perceived in Case Problems, Sub-
jective vs Objective Mode, in Rank Order . 200

555. Influences Perceived for Case Problems,
Major Groups, and Totals . . . . . . 203

5GB. Influences Perceived for Case Problems-—
Consolidated, by Functional Aaeas . . . 205

5'7. Influences Perceived for Case Problems, Con-
solidated, by Organizational Levels. . . 207

553. Influences Perceived for Case Problems Com-
pared with Influences Ranked in Part II,
by Groups . . . . . . . . . . . 209

E59. Influences Perceived for Case Problems Com-
pared with Influences Ranked in Part II,
by Functional Areas . . . . . . . . 212

. Influences Perceived for Case Problems Come
pared with Influences Ranked in Part II,
by Organizational Levels . . . . . . 214

. Summary--Ethica1 Content and Quality--Per-
centage of Prudence and Justice in Case
Problem Action Choices, by Functional
Areas. . . . . . . . . . . . . 252

xi

 

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of Case P

Intel 5 ‘:::_
cf Case

Table Page

.Ar2. Subjective Mode--Ethical Content and Quality
of Case Problem Action Choices . . . . . 253

.ArB. Objective Mode--Ethica1 Content and Quality
of Case Problem Action Choices . . . . . 254

.Ar4. Total Summary--Ethical Content and Quality
of Case Problem Action Choices . . . . . 255

Il-l. Case Problem Action Choices Selected, Before
Consolidation. . . . . . . . . . . 280

Ifi-Z. Case Problem Action Choices Selected, Before
Consolidation. . . . . . . . . . . 281

F-flB. Case Problem.Opinion Choices Selected, Before
conSOIidation. O O O O O O O O O O 282

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LI ST OF FI GURES

Fi gure P age
1. Stratigraphic Pattern and Composition of the

Survey Sample . . . . . . . . . . 34

2. Influences--Classified by A-O-S Orientation . 75

.3- Schematic of Ethical Criteria (ref. Chapter I,
pp. 15-25) . . . . . . . . . . . 129

4.. Case Problem Action Choice Patterns, Frequen-
cies, and Assigned Solution Rating Scales
(as Consolidated). . . . . . . . . 157

5.. Basis of Evaluation of Case Problems for
Ethical Content and Quality . . . . . 194

3‘1. Example of Chi-Square Test for k Independent
Samples . . . . . . . . . . . . 277

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LIST OF EXHIBITS

Exhibit
1. Case Problem 1, Objective
2. Case Problem 2, Objective
Modes . . . . . .
3. Case Problem 3, Objective
Modes . . . . . .
44. Case Problem 4, Objective

Modes . . . . . .
Case Situation 5 . . .

Case Situation 6 . . .

xiv

Mode Only . .

and Subjective

and Subjective

and Subjective

Page

135

140

144

147

150
153

 

CHAPTER I

INTRODUCTION AND HYPOTHESES

Purpose of the Research

 

The business man in our American free enterprise
System is continually faced with the need to make decisions
WhiJSh require the exercise of moral or ethical judgment.
The: increasing volume of literature on the subject of
buSiness ethics is evidence of that, although a part of
the: increase in absolute terms may simply parallel the
general information explosion in all areas of our knowl-
edge. For example, an annotated bibliography of 103 pages
(7533 items) compiled by a team of researchers at South
Daliota State University1 shows the following: ten years
l930-39--32 items; ten years 1940-49--73 items; five years
l950-54--119 items; five years l955-59--246 items; four
Years 1960-64--283 items.

In the foreword to Ethics in Business, by Raymond

 

:Banmhart, S. J., R. Joseph Monsen states, "Intelligent

1Philip W. Van Vlack, Charles L. Sewrey, and
Charles E. Nielsen, Economic Ethics Bibliography, Bulletin
524, Economics Department (8. Dak: South Dakota State
University, December, 1964).

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(iiscussion and illuminating teaching of business ethics
1138, up to now (April 1968) been unusually difficult and
(aften highly unsatisfactory--primarily because we have so
few facts to deal with, and because we have known so

Llittle about the businessman's feelings and attitudes on

O I I I O 2
teth1ca1 issues 1nvolv1ng bus1ness."

This researcher's observations and experiences
(hiring thirty-four years of administrative management in
vazzious industries also have led him to believe that there
is .a.growing need for research in this area.

The b£92g_purpose of this research study, then, is
t1) sprovide additional knowledge about, and insight into,
thEe ethical dimension of business problems and of the
at1:itudes and behavior of managers in dealing with prob-
lemns of that nature, but more specifically within the

mavl'Tlagerial sector of large industry.

The General Problem
Many writers and a number of researchers have
Studied and discussed the ethical problems of business
fl‘om a number of viewpoints and have offered to the busi-
ness world the benefit of their insight, wisdom, and
findings. For example, the Harvard Business Review

Offers a compilation of fifteen recent articles on the

2Raymond Baumhart, S. J., Ethics in Business
(New York: Holt, Rinehart and Winston, 1968), Foreword,

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problems of business ethics3 some of which also consider
the roles of religion and Christianity, and the personal
value systems of individuals. A companion series of six-
teen articles4 delves into the related area of business
philosophy. Such articles point up the increasing diffi-
culties which men in all areas of business and at all
Jxexrels of management face in attempting to satisfy the
various claimants on the business--owners and stockholders,
government units, employees, consumers, suppliers, and
Society in general.

Even more significant, many men below the top
management level face heavy, often unreasonable, and some-
‘tiJnes unrealistic demands to meet stipulated performance
gtmals. If higher level management's philosophy, policies,
‘31? guidelines are lacking, uncertain, ambivalent, or dis-
tcDrted by intervening levels, so that the apparent or
infllplied desires of top management appear to be inconsis-
t*3nt with a sound value system or acceptable ethical
p3l=‘a.c:tices--or legal restraints, the subordinate may become
‘adisoriented and behave irrationally. Fear of economic

s‘antions may also act to aggravate the situation.

Ethics for Executives Series, Harvard Business
Review, Cambridge, 1968.

 

Philosophy of Business Series, Harvard Business
Review, Cambridge, 1966.

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Father Baumhart's survey elicited many examples
cxf' such pressures to get results, regardless of the means
tismeéL
Impossible demands, say our respondents, espe-
cially if accompanied by an implied "produce or get
out" attitude can quickly result in unethical be-
havior. The lonely subordinate, faced with demands
like these, occasionally dreams about a union for
middle management, complete with seniority and
grievance procedures. . . .

A common defense by top management is that it is
only fair that pressure be kept on subordinates
since stockholders and competitors keep the pressure
on top management. . . . It is doubtful that widely
disparate and anonymous stockholders exercize pressure
Ion top management comparable to the pressure that
executives bring to bear on their subordinates.5

Approaches to the problem have considered the
nattire of man, his perceptions and beliefs, and consider-
ation of ethics on both philosophical and theological
haSes, as well as the currently accepted norms of various
sQCial environments. The field of inquiry is vast, and
as old as the history of man. The rapidly accelerating
Pace of economic, technological, political, and social
change this modern world is experiencing, especially in
tllfii United States, requires man to constantly re-adapt
Itilrmelf to new and continually changing environments, sit-
uations and forces, and to cope with mounting pressures
a11<3 a complexity of variables for which he is often

lllfllrprepared. He therefore needs and sometimes seeks

grlidance for his own actions and those of others for whom

5Baumhart, Ethics in Business, p. 83.

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he may be responsible. In the technological sphere he
has managed to successfully bring to bear his knowledge
of much new scientific discovery. For example, the con-
cept of a "stable platform" in the electronic guidance
systems of space vehicles, oriented to a fixed astral
reference point, permits incredibly fine in-course navi-
gational adjustments--on signal. While new discoveries
arwe also increasingly true in the area of human behavior,
there is much to be desired, particularly with respect to
man ' s motivation and the influences to which he is sub-
jected. Fortune, for instance, cites continuing research
irrtxb conditioned learning by social scientists using
teczhniques of operant conditioning and stimulus response.6
(Seam similar concepts be used to motivate and guide human
behavior in the business and industrial context?

We appear to be pushing the frontiers in combining
the findings of other scientific areas, but will this
bring us to grips with some of the real problems of people
11" industry? For instance, there are internal factors
sLlczh as: What do men believe--how strongly? How committed
are they to such beliefs, and how effective are such
13$liefs, values, or ethical systems? Contrastingly, there

ani‘e external factors such as: What influences are brought

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At Man," Fortune, January, 1970, pp. 113 ff.

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to bear on the individual? How strong are they? Which

are negative, which are positive?

The Approach to the Study

This study is structured to build onto and extend
the work of others, some of whom have included in their
work consideration of the role and influences of religion
and philosophical ethics in providing guidance for ethical
Problems in business. A number of such studies and their
findings are discussed in later sections. Most have sur-
veyed relatively generalized populations for attitudinal
responses and value preferences. This research makes an
eXtensive study of a selected group, drawn from the mana-
gerial sector of large industrial firms, using a survey
instrument especially structured, for this group. Because
religion is generally considered to provide a strong foun-
dation for ethical standards another special group of mana-
gers was included, the members of which profess a strong
re ligious orientation, in order to explore the extent to
WI'lich their common dependence upon religious (spiritual)
g"Glidance affects their managerial decision making. In
addition to specific questions, hypothetical problem situ-
a‘iions were designed to simulate some of the problems
e1'lcountered by middle and lower level managers.

The specific problems, related questions, and
vsDecific hypotheses are set forth below, together

with citations of related research. The major thrust

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()1? ‘this study is the analysis of the ethical perceptions of
managers in large firms and the effects of non-technical
and non-economic influences on their decisions dealing with
problems involving ethical considerations.

In brief, an attempt is made to determine the extent
tc: vvhich the organizational orientation of the middle and
lower level manager in industry measureably influences his
dem:i.sion choices when ethical considerations are involved.

Organizational orientation in this context is the
Stun. total of all perceptions the manager has as to his
Specific position, functions and relationships in the
organizational hierarchy and structure. The specific

hypotheses which follow consider various aspects of this

Orientation .

Specific Problems, Hypotheses,
and_Questions

%thesis 1

The individual manager will tend to view himself as
more ethical than other managers.

Direct evidence of the existence of biased attitudes
WC>‘uld aid in understanding the decision process and help to
Ea”Cplain how managers perceive each other in their roles. A
:BEéries of general questions were used by Baumhart7 to arrive

at a similar conclusion. In this case three of six decision

7Baumhart, Ethics in Business, pp. 20 ff.

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problems are worded subjectively for half the respondents,

and objectively for the other half to test this hypothesis.

Hypothesis 2

 

Managers engaged in some business functions will,
as a whole, have significantly different percep-
tions of the solution possibilities of ethical
problems from managers in certain other functions.

Baumhart8

also found that people had a higher or
lower opinion of the ethics of various professions and vo-
cations, being more of critical selling and financial activ-
itziees. The test in this study compares not only the kind

of alternatives selected by the respondents but also how

coupletely the various problems are solved by the decisions.

Mothesis 3

There will be significant differences in the per-

ceptions of the solution possibilities of ethical

problems between managers from one organizational
level and those from certain other organizational
levels--the higher the level, the more complete

the solution.

The same test procedures are used for this hypo-
t1'lesis as for the one above. Positive evidence of bias due
i3<> function and level would help to clarify the decision
I311‘ocess and might indicate a need for greater specificity
:11) company policies and procedures and in designating extent
(315 responsibilities. Jennings9 indicates that self-confi-

flEance as to position and role affects managerial performance.
\

8Baumhart, pp. 96 ff.

9Eugene E. Jennings, The Executive in Crisis, MSU
Business Studies (E. Lansing, Mich.: Michigan State Uni-
versity, 1965), p. 117 ff., p. 170 ff.

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Hypothesis 4

 

Managers engaged in some business functions will,
as a whole, reflect different proportions of
prudence vs justice in their ethical problem solu—
tions from managers in certain other functions. ‘
Prudence is defined as the individual manager's
concern for self-interest internally to the company and
contpany interest in relationships externally to the company.
Justice is defined as concern with the interests of others
as Opposed to self-interest. Internally to the company
this could be the interests of other individuals, or the
jJiterests of the company vs self-interest. Externally to
the company this could be the interests of outside indi-
‘Riéluals or of other companies or groups vs the company's
Self-interest. The test is made by comparative analysis of
the respondents' solutions to hypothetical problem situ-
a”ti-ions as they reflect prudence and/or justice. Positive
eVidence of tendencies toward this kind of bias would also
be an aid to understanding the decision process in problems

itlvolving ethical considerations, leading to more equitable

t:t‘eatment of the various claimants on the company.

gkpothesis 5

Managers engaged in some business functions will,
as a whole, have significantly different percep-
tions of the relative importance of non-technical
influences which may affect their decisions in

ethical problems from managers in certain other
functions.

Decision making could be better understood if more

information were available relative to the various kinds of

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influences to which managers might be responsive. The test

.111 this study compares influences rated by the respondents
113 the abstract with the influences perceived by them to
bus

operative in hypothetical problem situations.

Hypothesis 6

The more religious manager will be more concerned
about the interests of others and less concerned
with self-interest than the less religious manager.

Inclusion of the religious test sample in the study
Provides an opportunity to compare their solutions to the
hypothetical problems with those of the general group to
Seek positive evidence of this form of bias, which could

assist in understanding the handling of ethical problems.

IlXEWhesis 7

The perceptions of organizational climate held by
managers in one function will differ significantly

from those held by managers in certain other
functions.

Organizational climate for the purpose of this
£3”'Z‘udy includes interpersonal relationships, ethical atti-

tJades of company and personnel, and the manager's view of

his own status in the company. This could affect the

‘3E3gree of confidence he has in his decision making judg-

InEint.

Similar notions are expressed by Jennings10 in his
discussions of the executive's view of himself, his role,

303d his membership in the executive group.

\

10Jennings, pp. 85 ff., pp. 128 ff.

 

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Other Related Questions

In addition to the above hypotheses a number of
questions will be considered which could increase under-
standing of the variables which affect decision making.
These will consider whether significant relationships can
be found between various personal, influential, and environ-
nmerrtal variables and the manager's function and level in
_the organization, and whether any combination of these can
be seen to affect his decisions in ethical problems. For
eitaunple, it is commonly accepted that the older manager is
more conservative and usually more experienced than the
younger manager. Comparisons are made of the problem
Solutions selected by the older and younger managers to
See if such evidence can be found. Other questions and
Correlation possibilities are discussed which became
apparent as the response data were compiled and reviewed.
CkDRparisons are also drawn with the findings of other
J“SE-cent research such as that of Baumhart,ll Senger,12 Van

Vlack,13 and Schutte,14 as well as other citations.

\

11Baumhart, Ethics in Business

12John D. Senger, "An Analysis of Executive Value

S‘l:ructures" (unpublished Ph.D. dissertation, University of
Illinois, 1965) .

13Philip W. Van Vlack, Manggement Ethics Guide,
I*ulletin 523 (rev. ed., Brookings, S. Dak.: South Dakota
State University, December, 1965).
14Thomas F. Schutte, "An Exploratory Study of
Executives' Perceptions Toward Business Ethics" (unpub-
lished Ph.D. dissertation, University of Colorado, 1963).

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Problems of Definition and
Application of Ethics

 

 

The Van Vlack bibliography has 793 individual
citations which relate in one way or another to ethical
behavior, with much emphasis on theological ethics in Wes-
tern religions. A more limited number (about 60) relate
to the general area of business, and fewer (about 30) to
management in particular. Most items in these latter two
groups deal with the relationship of ethics to external
entities--the consumer, the public, society in general,
competition, the government, labor, etc. Few deal directly
and specifically with managerial problems involving intra-
company ethical considerations, that is, with management
below top level. However, a number of writers and
researchers, such as Baumhart and Van Vlack, do include
some examples, and related discussion, of internal prob-
lems. This researcher has thus far found little that
resembles the approach being taken in this research pro-
gram. Under the circumstances, references to other liter-
ature tends to be "extractive" and somewhat fragmentary.

Ethics is an area of philosophical study about
which much has been written. A comprehensive treatment of
ethics, as such, is beyond the scope of this thesis. How-
ever, an analytical summation of salient points follows.

Van Vlack identifies certain key concepts in
ethics which he defines in the following terms:

Ethics is often called "moral philosophy" as the
philosophical study undertaken to improve actions.

 

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Ethics is the field of study, and morality is what is
studied. As a discipline or branch of knowledge,
ethics is sometimes divided into meta-ethics and
ethics normative. Meta-ethics concerns logical and
semantic problems of ethical or moral statements and
arguments. Normative ethics or ethics proper, deals
with the norms of human conduct, both with respect

to their foundation in principle ("basic ethics")

and with respect to their application in circumstances
of actions ("applied ethics"). Some writers add
"descriptive ethics" to denote social-scientific
studies of morality.15

 

Ford and Kelly differentiate ethics and moral
theology, terming them both sciences,

Ethics is the science of morality based on reason;

it considers man in the natural order, possessed of

a natural destiny. Moral theology includes ethics
and goes beyond it--absorbs it, so to speak. Moral
theology studies man in the supernatural order,
possessed of a supernatural destiny; it is a science
based not only on reason--nor principally on reason--
but especially on revelation and on the teaching of
the Church. Reason is the supreme argument in ethics;
authority is the sovereign guide of the theologian.16

Another comparison is made by Garrett, who states,
with respect to both ethics in general, and business
ethics,

Ethics . . . is taken to be the study of moral right-
ness and wrongness of human activity insofar as these
can be known by reason. Such a study must consider
nearly all aspects of man and his activity, but in
relation to the ultimate and true good of man, not
merely to what men want, or_do, or think. Ethics,
then, is a human science, limited to a large extent

 

15Van Vlack, Ethics Guide, p. 122.

16John C. Ford, S.J. and Gerald Kelly, S.J., "Con-
temporary Moral Theology," in Morality in Business, ed. by
Henry J. Wirtenberg, S.J. (Chicago: Loyola University
Press, 1962), p. 7.

 

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by the state of our knowledge, but capable of
arriving at some valid conclusions. . . .17

Business ethics is . . . an attempt to develop and
apply basic principles in the area of human economic
relations. Because of the nature of the field busi-
ness ethics has several particular qualities . . .
involving relations to groups as well as individuals
. . . dealing with relative or physical goods rather
than directly with absolutes. . . . Business ethics
are more than a type of Commercial etiquette, or'a
code of accepted practices. . . . Our search is for
principles and not merely for good business policy

. . . (and) must go into questions of political

and social philosophy as well as into matters of

truthfulness, exchange justice, and fair treatment
of employees.18

Yet another variation is given by Wheelwright in
a simplified definition which does not term it a science,

Ethics is a branch of philosophy. It is a philosophy
of moral conduct and of the standards by which moral
conduct and its effects are to be judged. Ethics

is therefore a more or less structuralized account of
moral values--the degree of structuralization depend-
ing on the type of ethical theory in question.19

Roubiczek develops the definition somewhat more
systematically, and with a different emphasis,

Ethics includes morality, but is wider in scope; as
well as the foundations and implications of morality,
it includes the question of how far we can know for
certain and speak about an absolute value at all--
That is, the epistomological problem of the limitation
of knowledge. . . . The subject matter of ethics is
traditionally circumscribed by the following three
questions: 1. What ought we to do? 2. What is the

 

17Thomas M. Garrett, S.J., Ethigs in Business
(New York: Sheed and Ward, 1963), pp. 3-4.

laIbid., p. 5.

19Philip Wheelwright, A Critical Introduction to
Ethics (New York: Odyssey Press, 1935), pp. 40-41.

 

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meaning of 'good'? 3. Are we able to do what we
ought to do? The first two questions are moral ones,
but in their ethical sense they also lead to the
investigation of how it may be possible to arrive at
an answer, why an answer is valid, and if so, on what
grounds we are under obligation to observe any rules
or laws which we discover. The third question con-
cerns the freedom of will which must be the basis of
any such obligation, for commands would be senseless
if we were unable to obey.20

Baumhart had queried his respondents on their
definitions of ethics, and having received a variety of
opinions decided upon use of the following:

Ethical: conforming to principles or ideals of
human conduct; according to common usage, the follow-
ing terms are more or less synonymous with ethical:
moral, good, right, just, honest.

Ethical standards: principles or ideals of human
conduct.

Ethics: the study of the morality of human actions;

hence, the standards for these actions.

Morality: the property of an action by means of which

it conforms to a norm of human conduct.21

The foregoing citations, taken more or less at

random, indicate a considerable diversity of concepts of
ethics in the broad View. When limited to the area of
business and industry the definitions tend to become nar-
rower, with emphasis on the economic relationships, and
with some attempts to codify behavior. However, many

writers seem to agree that each situation must be analyzed

for itself, and that such general prohibitions as those

 

20Paul Roubiczek, Ethical Values in The Age of
Science (London: Cambridge University Press, 1969),
pp. 5-6.

21Baumhart, Ethics in Business, p. 15.

 

 

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against lying, cheating, stealing cannot be arbitrarily
applied. Thus, the lack of certainty--the "circumstances
alter cases" attitude-~may contribute greatly to the unen-
thusiastic reactions of many businessmen to the attempts
of "outsiders" to clarify and help solve their apparent
ethical problems. Walter Koch, President, Rocky Mountain
States Telephone Company, stated at a conference on
business ethics at Valparaiso University in 1965 stated,

As I see it, the great moral dilemma of the
American businessman today is not to be ethical or
to be unethical. . . . The businessman's problem
stems out of the confusion which permeates the Amer-
ican ethical system. The fact is that while we often
talk of ethics as being a simple matter of good over
evil, it seldom works out quite that way. Even
lying and stealing are not always black and white
matters, but these basic moral ideas are not my
principal references at the moment . . . (but rather)
. . . those . . . associated with fair treatment of
free men and the progress of a free society. Many
generally accepted ethical concepts of this kind
are in conflict with one another, . . . the dictum
to treat all men as equals . . . (yet) . . . that
merit in a man deserves special . . . reward; . . .
we believe the individual should . . . exercise his
free choice . . . (but) . . . invoke the rule of the
greatest good for the greatest number. We exhort a
man to stand up for his beliefs . . . yet we honor the
doctrine of mutual compromise . . . between beliefs.
Given these and many more paradoxes in our ethical
standards . . . the businessman can act in a given sit-
uation in a way that is ethical to some of his judges
and unethical to others.22

(It is) my claim that the businessman' s dilemma
in ethics is how and when and which--seldom whethgg.
Our American concepts do not make a neat, con91stent

 

22Walter F. Koch, "The Paradoxical Ethical," in

The Christian in Business, ed. by Andrew J. Buehner (St.
Louis: Bethany Press, 1966), pp. 36-37.

 

 

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package . . . they are confused, contradictory, para-
doxical. . . . Ethical consensus is necessary. . . .23

It seems obvious that ordinary definitions of
ethics mean little to the average businessman--or to any-
one else. A more systematic approach, similar to that of
systematic theology, is necessary--one which dissects and
explains ethical concepts, principles, and values and

provides a basis for understanding "how and when" to apply

them.

C. I. Lewis (a proponent of ethical naturalism
coupled with ethical rationalism) recognizes the problem
as he brings into view a set of criteria for ethical eval-

uation,

Ethics is a most complex subject, and any attempt to
reduce it to simple terms would be ill-judged and
doomed to failure. Good or bad identifies with the
consequences or results, whereas right or wrong iden-
tify with the means or the act itself and with the
intention. A pertinent distinction is between expected
and actual consequences. Objective rightness of an
act is judged on the basis of whether the consequences
are right to bring about. This is contrasted with
subjective rightness of an act, which is one which
the doer thinks will result in consequences which are
right to bring about. These distinctions are not
confined to moral judgment of acts, but extend to
those which may be prudentially or technically right
as well as to their character as just or unjust to
others. The distinction of right and wrong extends
to every topic of reflection and to all that human
self-determination of act or attitude may affect.
Prudence has to do with one's own interests; justice
with the interests of others. Technical rightness
has to do with how to achieve some species of common
purpose. A mental decision resulting from deliber-
ation can become a commitment to act, and if morality
and justice dictate, should become an act, any overt

 

23Ibid., p. 44.

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18

expression, which is that which can be criticized.

The criticism can turn on nothing but the consequences,
actual or expected. The primary concern of ethics is
with the moral integrity of the doer and his final
responsibility; this can be termed right-mindedness.
Solution of the central problem of ethics requires
determining what character of the consequences of
action it is by reference to which one act will be
right and another wrong. Strictly there is no such
thing as moral goodness or badness: moral distinctions
apply only to doers, who are right-minded or the
opposite, and to their deeds or intentions, which are
right or wrong. The rightness of an action is deter-
mined by a rule or directive of right doing and a
judgment of goodness to be found in the consequences
of the act in question. Imperatives include seeing
oneself in others, objectivity, compassion, moral
equality, equality before the moral law.24

Returning to Roubiczek (who favors the subjective
method of ethical inquiry) we find that he brings into
consideration the question of values,

There are three absolute values; truth, goodness, and
beauty, which are ends in themselves and require
embodiment to become real. There are a host of rela-
tive values such as health, happiness, compassion,
trust, humility, some of which are virtues. Four
other significant values border on, but are not abso-
lute values: nobility, justice, love, holiness.
Nobility is subjective; justice must not be influ-
enced by anything outside itself, not even by love.
Love is not truly a value, but transcends all values
because it must not be based on a judgement--it must
be unconditional. Holiness transcends the sphere of
values and presupposes faith. Holiness can be
accepted only after the absolute has been experienced
as transcending all human evaluations. There are only
three absolute values, and this indicates that there
are only three major operations of thinking which
make us accessible to the impact of the absolute.

To grasp truth we must break through the surface of
reality and try to get hold of its innermost nature,
and this is characteristic of the objective method by

 

24Charles I. Lewis, The Ground and Nature of the
Right (New York: Columbia University Press, 1958).

 

 

 

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19

which we try to achieve a more fundamental knowledge,
beyond objects and events to the laws which determine
them. . . . Beauty . . . means complete concord between
form and content. This corresponds to the . . . sub-
jective method in that internal reality, to become real,
must be embodied. Goodness is the third such absolute.
To understand man we must start from freedom, awareness
of which transcends the scope of the objective method;
but freedom itself, as distinct from awareness of it,
transcends the subjective method, too, because it must
be freedom to act. Thus a third way to the acquisition
of a fuller knowledge is opened. The two methods . . .
enable us to understand either external or internal
reality. But our actions include both; inner motives
produce external events. . . . Goodness corresponds to
this way from freedom through action to understanding.

There is yet another requirement for a more complete

apprehension of ethics and the application of ethics, which

Roubiczek discusses,

. . . a conscious effort of thinking . . . can account
neither for the absolute nor for essential knowledge,
yet by our experience we cannot deny their existence.
There is no solution but to make the leap of acceptance,
even though we cannot prove the existence of the abso-
lute nor derive essential knowledge from any other
knowledge. Ethics then becomes what it should be--
self evident and a matter of course. . . . As soon as
we accept the absolute as the source and basis of ethics
and are thus enabled to accept ethics without hesitation,
no longer questioning its foundation and justification,
we experience a liberation. We know morality better
than anything we can know by the objective method, be-
cause we know it by inner experience. What Kierkegaard
calls the ethical self, and its potentialities will,
whenever touched upon, come into the open, enabling us
to accept moral commandments, principles, love of one's
neighbor--the essential knowledge which impresses it-
self upon us as absolute. . . . Faith demands a clear
conception of the absolute--not the abstract idea of
something which is absolute or trancendental, but God
and thereby a definitive statement about all existence.
Ethics demands essential knowledge which springs from
the absolute, is immediately applied in action and

leads back to our own world; . . . 5

 

25Roubiczek, Values in Age of Science, pp. 268-274.

 

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20

One more point of view rounds out this analytical
sub-structure, that of Tillich, the philosopher—theologian,
in his discussion of the principles of moral decision,

Every decision is necessarily a cutting through some-
thing and a cutting off of other possibilities, but
this means that a decision can be willful, made arbi-
trarily without a guiding norm. Therefore we ask: Are
there guiding principles by which we can distinguish
genuine decisions from the compulsions of willfulness?
If there are, they must be absolute on one side, rela-
tive on the other. An absolute principle for moral
decisions has to be both . . . absolute, to save us
from drowning in the chaos of relativism . . . rela-
tive, to enter into our relative situation, the ethical
contents. Our search for such principles can start
with the absolute . . . the unconditional imperative

to acknowledge every person as a person. If we ask

the contents given by this absolute, we find, first,

. . . the command not to treat a person as a thing.
This seems little, but it is much. It is the core of
the principle of justice. . . . This . . . could lead
us into problems of social ethics--whether the abso-
lutes that appear in personal moral decisions are
analogous to decisions of social groups . . . such an
analogy is limited by the fact that a group is not cen-
tered in the way an individual is . . . (and) is not a
person, and this changes the whole ethical situation.

. . . A a e love is the absolute moral principle, the
ethical EEsolute . . . and it has the basic principle
of justice within itself. . . . (Also) needed . . . is
listening to and looking at the concrete situation,
which includes the deepest motives of the other per-
son. . . .

Yet another link is needed to arrive at a concept
of Christian ethics. Roubiczek and Tillich both talk of
God. Roubiczek states that "God known is no God--so that
it would be blasphemy to make our belief in God dependent

on any test conducted by our limited knowledge."28

 

27Paul Tillich, My Search for Absolutes, (New
York: Simon and Schuster, 1969), pp. 105-09.

28Roubiczek, p. 311.

 

 

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21

Bonhoeffer states that the root and ground of Christian
ethics is the reality of God as revealed in Jesus Christ,

Only he who knows God knows what love is; it is not
the other way around; it is not that we first of all'
by nature know what love is and therefore know what
God is. No one knows God unless God reveals Himself
to him. And no one knows what love is except in the
self-revelation of God. Love, then, is the revelation
of God. And the revelation of God is Jesus Christ.

. . . God's revelation of His love precedes all our
love towards Him. Love has its origin not in us but
in God. Love is not an attitude of men but of God.

. . . The New Testament . . . choice of the concept of
'love', agaEe, . . . acquires an entirely new conno-
tation in t e New Testament message, yet it is not
entirely without connexion with what we understand by
'love' in our own language. . . . Love is the recon-
ciliation of man with God in Jesus Christ. . . . Love,
therefore, is the name for what God does to man in
overcoming the disunion in which man lives. . . . The
love with which man loves God and his neighbor is the
love of God. . . . It is as whole men, as men who
think and who act, that we are loved by God and recon-
ciled with God in Christ. And it is as whole men,

who think and who act, that we love God and our
brothers.

How the individual Christian can follow the
‘gllidance of Christ is explained by William O. Smith, in
an analysis of Bonhoeffer's work,

The life style of the Christian is determined as he
searches after his real form of Christ in each con-
text. Once he has discovered who Christ is for man in
each situation, he seeks to conform to this image of
Christ. The Christian does not come into the circum-
stance with a number of principles to apply--he comes
with a process for discerning Christ. Christian ethics
becomes a living response and relation to Christ who is
present in each situation. Christ is concrete in each
life experience and ethics are contextual in relation

29Dietrich Bonhoeffer, Ethics, ed. by Eberhard
Bethge (New York: The MacMillan Co., 1965). PP. 50-54.

 

 

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22

-to the form which Christ assumes. Bonhoeffer has
larought the convergence of theology and ethics.

This researcher has deliberately confined his com-

men ts with respect to the above series of citations to

Primarily connective and introductory statements, in order
IICDVt:

to dilute the effects of the transition from rather

Simple but vague definitions, through the more complex but
clearer concepts of the essence of ethics.

The various
<=Irj_1:eria thus established are referred to in later discus-

€35.C>IIS and analyses of the survey findings. For later con-
‘V‘Blicience in determining the ethical content and quality

c>f5 'the solutions selected by the respondents to the prob-

Ileana situations, many of the key concepts and phrases in

t11€3 above citations have been incorporated into a "sche-

Inatic" representation of ethical criteria.

Included are
primarily those which appear to be appropriate in the

lrldnstrial and business context.
To sum up: we have, in the above representative
ci‘tations, a picture of ethical possibilities ranging from

331 extreme of no ethics on the one end, to self-sacrifice
0n the other end.

The position any one decision maker

‘takes may well depend on the degree of conscious personal
cOmmitment he has to any position along the continuum and
the extent to which he is sensitive to the proddings of

30

. William O. Smith, Th.D., "Christ and Ethics in
D1etrich Bonhoeffer"

(unpublished Th.D. dissertation,
Pacific School of Religion, 1968).

 

 

 

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23

hi 8 conscience. Whether he is willing or able to act in

consonance with such a commitment may be entirely depen-

dent on the over-riding effects of other constraints on

his behavior in the industrial context. What kinds of con-

straints these are and how strong they are will be con-

sidered in the analysis of personal, influential, and

environmental variables in later chapters. Certainly sit-
uations arise in which other individuals or groups are

involved whose attitudes that "this is the way the game is
Played" preclude the introduction, at such times, of ethi-
cal considerations by anyone not of the same mind. i

The comments of Harvard Business Review readers

about recent articles such as the pair on the "Crisis in
Cthscience at Quasar"3]"32 dealing with falsifying reports

to higher management, and the pair on "Is Business Bluffing

Ethical"33'34 are clear evidence that opinions and atti-
tudes are divided. Thus, the fear of losing ground or of

being taken advantage of unless one acts first, together

\

31

John J. Fendrock, "Crisis in Conscience at,
Quasar," Harvard Business Review, March-April, 1968,
Pp. 112 ff.

32

John J. Fendrock, "Sequel to Quasar Stellar,"
Egrvard Business Review, Sept.-Oct., 1968, pp. 14 ff.

33

Albert Z. Carr, "Is Business Bluffing Ethical?,"
Eggvard Business Review, Jan.-Feb., 1968, pp. 143 ff.

34

Timothy B. Blodgett, "Showdown on Business
Bluffing," Harvard Business Review, May-June, 1968,
pp. 162 ff.

 

 

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24

w1th the rationalizations of expediency and the effects of

pressure for results, appear to foster a climate in 1ndus-
try 1n wh1ch a high level of ethical conduct for managers

at mddle and lower levels may often seem to be a h1n—

drance. This could especially be the case when relation-

sh 1ps are impersonal, as between groups, or between 1nd1-

VJ. duals who may never have met--when each other may be

only a name or a voice.

The more religious manager who attempts to order
his life in accordance with the authoritative guidance of

his God-—for the Christian this may be expressed in the

B:l—ll'Jle—«may find himself in conflict with the human author-

1ties in his work place. Powell35 has examined this prob-

lem in considerable depth.

Review of Related Research
and Literature

In addition to the usual library research and
J:‘QV1ew of abstracts in the pertinent areas, the DATRIX
department of University Microfilms, Inc. , of Ann Arbor,
le‘lchigan was requested to make a search on the bas1s of
key words associated with the area of interest Their

findings were small, and failed to turn up two theses

t1t1es which this researcher had found in footnotes in

35

Reed M. Powell, Race L Rel Anon and the Promotion
of the American Executive (Columbus, Ohio:

Ohio State
University, 1969).

 

 

 

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25

other publications and had already ordered from them. They
supplied sixteen listings, of which only one had reasonable

relationship to the present research, and three or four

others were in areas somewhat related, namely, decision-

making and management. The titles of the remainder in-

cluded key words such as "ethical," "perceptions," and

" values," but not in an appropriate context.

Library research disclosed many research studies of

related interest in the form of abstracts or condensations

thereof, and annotated bibliographies of literature in the

aareas of interest.

The topical areas included: Business

E":I'Iics, in which literature was found containing chapters
on Ethics; Ethics and Religion; Ethics in non-religious

contexts; Values; and Ethics in general. The regular Bib-

lioqraphical section of this thesis contains a complete
listing of all references used and literature examined.

There were, however, four research studies found

Which deal specifically with the topical area of this

t-1'1esis, and these are described and discussed below:

1. Ethics in Business, by Raymond Baumhart, S.J.,

1968 (also to be found as a hard-cover copy under the

title, An Honest Profit) appears to be, to date, the out-

Standing work in this field. It records the findings of

a survey in depth of some 1,800 businessmen subscribers to

I_ic'=1_rvard Business Review, which was made in 1962, as well as

interviews made in 1966. Although the respondents can

11

 

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26

be said to be above average in education, income, and

position, their responses provide a valuable and much-

needed index to ethical perceptions and attitudes in
$.11ufiilgstry.

Of particular interest to this researcher are
the

two, rather brief, chapters titled, "The Long Shadow

Of the Boss," and "Managerial Level and Occupation," and
t:r1<a

findings of the present study are discussed, later
on

I

in the light of the insights provided by Father

IBEilarnhart in these, as well as other, chapters. Inasmuch
5353 11is study and approach were rather comprehensive and

much more externally than internally oriented (with
reSpect to the enterprise, as such) as indicated by the

nEitzure of the questions in the questionnaire instrument

iir1¢3 as formulated for the interviews, his findings pro-

‘liJie more insight with respect to the behavior and atti-

ttides of executives in the firm vis-a-vis outside enti-
tiles. By contrast, the present research is more concerned

With the "inside" view and whether those variables might
b3 identified which serve most to explain managerial

l"’ehavior in the context of ethical problems. 6

2. "An Analysis of Executive Value Structures,"

by John D. Senger, Ph.D., 1965, an unpublished doctoral

thesis, investigated the relationship between executives'

values and organizational behavior. The behavior is,

36

Baumhart, Ethics in Business, p. vii ff.

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27

es sentially, that of decision-making. Using a somewhat
complex statistical approach, Senger concluded that per-

sonal values are related to and probably influence exec-
utives' policy decisions and operational decisions, that
executives in different classifications have different

Values, and that executives in different classifications

“light make different decisions with respect to the same,

given, circumstance; further, that upper level and general

managers are most affected by their personal values in
making these decisions. 37

Dr. Senger's findings are of
inSterest in the present research because his use of

"Values" is similar to the "influences" factor being here

“Sad to analyze the basis for managerial decision choices
1n ethical problems, and because his comparison of exec-
utives in various classifications is akin to the analysis

of the effects of functional orientation in the present
study. It is unfortunate that the statistical approach

uSed confined Senger's data to tabulations of factors in

slilch form that they cannot be readily used for comparison

with the data of the present study. However, his find-

ings do provide a valuable contribution to knowledge about
how executives make decisions.

3. Management Ethics Guide, by Philip W. Van

Vlack, 1965, is not a research study of the same type as

Senger, "Analysis of Structures."

|" MI'US-i

 

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28

the three others discussed in this section, but is,

rather, a thorough development of an approach to the

s tudy of management ethics. Its primary aim is on how

to proceed with moral and ethical inquiry--on how to do

ethical analysis. Van Vlack sees management ethics as

comprised of four problems: the scope of morality, moral

standards, ethical principles, and strategies in manage-

ment ethics. He deals in considerable depth with each

Of these, devoting a chapter to an intensive treatment of

each of the four areas. In addition to describing some

me thods of ethical inquiry, a set of management "audits"

for identifying moral problems inside and outside the
fi:l:'m, and for appraising managerial responsibilities in

folir areas, and also an "ethical perspectives" audit,

haVe been structured. Some interesting case problems and

cInestions and answers are also provided, as well as a

listing of 197 books and articles on the subject of busi-

l1ess ethics. No formal test was made of the "audits" in

the form of a survey, thus no data is available as to the

effectiveness of this approach. However, this does not

Preclude another researcher from making use of these

techniques. The present study draws a comparison with a

number of the ethical concepts and of some of the criteria

for evaluating the moral/ethical content of problem

situations. Dr. Van Vlack has provided a highly useful

 

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29

tool for dealing with the problems of managerial ethics
through study and education.38
4. "An Exploratory Study of Executives' Per-
ceptions Toward Business Ethics," by Thomas F. Schutte,
1963, is an empirical investigation of the business ethi-
cal attitudes of executives in American business firms.
Some aspects of Schutte's approach parallel the present
study. This researcher did not become aware of Dr.
Schutte's work in this area until after the computer
print-outs on his own survey had been received. Thus,
there was no opportunity to incorporate any specific
tests of any of that work into the present study. Never-
theless, some opportunity is provided for comparisons with
findings dealing with ethical problems internal to the
firm, from among the seventy-four tabulations developed
from Dr. Schutte's research, and the related questions.
His hypotheses numbered four: 1. Business executives
are aware of the various publics' images of business
ethics; 2. They have a differential perception toward
the theory and practice of business ethics; 3. They have
an institutionalized ethical perception toward various
business professions; 4. They do express some desire for
more guidance and direction for the creation and mainte-

nance of ethical conduct. According to the findings, all

38Van Vlack, Management Ethics Guide.

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30

four were supported. Of these, the second and third are
of some interest in the present study. Schutte structured
ten formal findings of a rather general nature and pri-
marily externally oriented. Only two of the ten are such
that some comparison can be drawn with the present study.
Schutte's questionnaire included sixteen multiple choice
attitudinal questions, four forced choice case problems
and one related question, and three open-end questions.
Of the total of twenty-four, three of the attitudinal
questions, and the four case problems will permit some
comparisons with the present study. Seven personal pro-
file questions were asked of which six are of the same
nature as questions in the present study. Dr. Schutte's
work adds considerable insight to the area of business
ethics and the attitudes of businessmen toward ethical
problems, and in a forty-six page Appendix, offers an
excellent examination of the classical ethical schools

of thought.39

Conclusion

 

In the foregoing pages, this researcher has set
forth: (1) The purpose of the research--which is, essen-
tially, an investigation of the nature of ethical problems
in the managerial sector of large industry; (2) A presen-

tation of the general problem--which is, that the decision

 

39Schutte, "Study of Perceptions Toward Ethics."

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31

function of managers invariably involves ethical problems,
and that managers below the top level have particular
difficulty because of conflicts arising from the pressures
to satisfy performance objectives which are often unrea-
sonable, and may require suppression of the manager's own
ethical sensitivity; (3) The approach to the study--which
identifies the area and groups to be the subjects of the
study; (4) The general and seven specific hypotheses--
which seek to establish the extent to which organizational
orientation and certain influences and perceptions affect
the decision making of managers in situations involving
ethical considerations, and the limitations, types of
assumptions, and general structure of the instrument to

be used, as well as certain other questions for which
answers are sought; (5) Problems of definitions and appli-
cation of ethics--which cites a representation of varying
definitional concepts, and sets forth (with a minimum of
comment) the essential structures of a representation of
ethical systems in considerable detail, which are later
on extensively referred to as a range of criteria against
which are evaluated the responses to the six case prob-
lems of the survey; and finally, (6) A review of related
research and literature--which describes the steps taken,
and makes a brief preliminary analysis of four specific
works, which are used for direct comparison with the

findings of the present study. In brief, this chapter

sexes, essenti;
:5 tie survey 1'
35.335 0f the a:

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32

serves, essentially, as background for the later analyses
of the survey findings, and in particular, discussion in
depth of the applicability of the elements of the ethical
systems described above is reserved for later development
in connection with analysis of the concrete aspects of the
six case problems and the related influence factors iden-
tified by the respondents. Thus, the existence of the prob-
lem has been recognized--manageria1 decisions include an
ethical dimension; its nature has been discussed--a better
comprehension of ethics and ethical practices, and when

and how to apply them, is needed; hypotheses and questions
are formulated which propose to test conditions under which
managerial decision making may or may not lack ethical per-
ceptiveness, and to seek reasons for or causes which con-
tribute to ethical or unethical behavior; an experimental
plan has been developed which investigates the personal
characteristics of the manager, the influences which may
bear on his decisions, and the environment in which he
operates, and also which tests his problem solving be-
havior and evaluates his decisions for ethical content

and quality, and attempts to identify personal, influential,
or environmental variables which may affect his decision-
making. Of special concern are the constraints which
conflict, either impelling or preventing ethical behavior.

All these are dealt with in the following chapters.

CHAPTER II

DESIGN OF THE RESEARCH

The Population and Samples

 

After extensive exploration with possible research
sites cooperation for the survey was ultimately secured
from the director of the management technical center of a
university which utilized a large number of middle and
lower level managers from nearby industries as its part-
time faculty. Its total current and recent mailing list of
403 names was made available, of whom more than 40 per cent
were actively teaching in the (then) current semester.
These men represented all major industrial functions. The
names of all the men on the list who were employed primarily

by three large firms in one industry were selected. The

 

total such number was 133, of whom seventy-three cooper-
ating respondents became the Group 1 which is shown on
Figure l--Stratigraphic Pattern, following. The rationale
for confining this sample to one industry was to make homo-
geneous the effects of external variables. This is the
major group under study in this research effort.

A second sample was taken, this time from the mem-

bership of a cooperating Christian businessmen's group in

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the area. The names of all members involved in purely
industrial activities were used, which excluded those
managers or owners in construction firms, professionals,
smaller proprietors, service organizations, and the like.
These men numbered forty-two, of whom twenty-eight cooper-
ating respondents became Group 2, also shown on Figure 1.
The reason for including this group, as previously stated,
was to test the relationships between professed religious
beliefs and ethics in decision-making. This Christian busi-
nessmen's group is affiliated with a total membership in the
United States and Canada of more than 12,000 men who repre-
sent many Protestant denominations and are conservative and
evangelical in their religious views. Their raison d'tre is
to apply in a practical way their religious commitments in
their daily business lives and to persuade others to do so.
Their motto is "Diligent in business; Serving the Lord,"
Romans, 12:11. They place the authority of God as revealed
in the Scripture above the authority of men but have a very
high respect for duly constituted authority, in business as
well as in government, as being divinely ordered.

The two samples thus drawn totalled 175, and re-
sulted in a net total of usable questionnaires from 101
respondents--73 in Group 1, and 28 in Group 2. Since the
(hpup l respondents are all part-time teachers they may
differ to some extent from the average middle and lower
level manager, having a higher than average level of edu-

cation and a stronger than average interest in their fields

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36

of work. However, the apparent bias thus introduced is not
considered detrimental to the purposes of this exploratory
survey. It will be taken into account to the extent that
it might become evident in any of the data analysis.

There are a number of differences between Groups 1
and 2 which are examined in detail in later chapters, but
one should be mentioned at this time. As Figure l--Strati-
graphic Pattern, shows, there is a significant difference
in their organizational levels. The highest level in
Group 1 is comprised of major department heads or men who
report to plant or division general managers; this is
Level 3. Group 2 includes a number of men who own or man-
age smaller industrial enterprises and men who report to
them, constituting a top level echelon; therefore, Levels 1
and 2 were established to provide for this. As it happens,
there were no respondents at equivalent levels in Group 1.

Although the total number of respondents in each
of the "cells" created by combining Functional areas with
Organizational levels is shown on Figure l (in parenthesis)
no data is compiled or analyzed for such cells, for three
reasons: the samples are too small to produce meaningful
comparisons, it is outside the planned scope of the present
program, and the number of computer tabulations which would
be created would be far too great to be manageable. There-
fore, data compilations and analyses are confined, as will

be seen, to provide comparisons between two major groups,

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37

the five functional areas and five organizational levels
for the total population of 101, and the five functional
areas and three organizational levels for the seventy-three
respondents constituting Group 1, this latter to exclude
the strong religious bias in effect when Group 2 is in-
cluded. Group 2 is not separately examined in this way
for most of the variables under study because the numbers
are too small to be meaningful in themselves. There are
exceptions, chiefly in connection with the six case prob-
lems and the related influences, where some of the compar-
isons are considered valid and useful. The appropriate

tables are expanded accordingly.

The Survey Instrument--
General Description

 

The survey instrument consists of a four-part
questionnaire. A full set of the questionnaire forms and
the memo of instruction to the respondents are included in
one of the Appendices. Part I, Personal Profile, elicits
data permitting sub-classification by characteristics such
as age, geographic origin, educational level, religious
affiliation, importance of religion, parent's background,
major life goals, etc. Part II, Influences on Decisions,
provides for the respondent to rate on a seven-point scale
a list of eighteen "influences" which might enter into
his decision making. These are grouped into three broad
categories, the comparative totals of which might indi-

cate the extent to which the respondents might exhibit

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38
tendencies toward authoritory-organization-self (AOS)
orientation. Part III, Environmental Factors, provides
for identifying the respondent's position in a strati-
graphic pattern internal to the organization, and also
for the respondent to indicate how he perceives his
interpersonal relationships, the internal ethical cli-
mate, his own situation in his Company, and his View of
his Company's goals. Part IV, Case Problems, sets up
six hypothetical problem situations involving ethical
considerations, providing for a variety of decision
choices for each. Cases 2 through 4 are structured
objectively for half of the respondents and subjectively
for the other half (which provides for testing Hypothe-
sis l). In addition, the respondent was requested to
indicate which three of the "Influences" listed (and
rated by him) in Part II entered most strongly into his
decision choices for the case problems.

Plan;for Data Compilation and
Statistical Validation

 

 

Sidney Siegel's Non-Parametric Statistics for
Behavioral Scientists was used as the guide for the sta-
tistical procedures applied. The data gathered are essen-
tially non-quantitive, that is, nominal, ordinal, or
interval in nature. Thus, the non-parametric techniques
were deemed to be the most appropriate. The Applications
Programming Department of the University Computer Center

was consulted, and they recommended their "modified CISSR

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39

program" (CISSR = Computer Institute for Social Science
Research). A programmer was assigned by the University
Computer Center to coordinate. Under his direction the
code sheets and data input program.were prepared. The
data were transferred from the questionnaires to the data
input coding forms, and the programmer subsequently co-
ordinated the keypunching and the computer runs. Further
details of the statistical procedures are given in the
Appendices section. The modified CISSR.program provides
for appropriate statistical tests, which included the Chi
Square and Contingency Coefficient tests used for the data
in this study. The program also converted the raw data to
percentages for both rows and columns and calculated means
and standard deviations. The resultant statistics-~Chi
Square values, probability percentages, and coefficient
factors--are included on all the tabulations to which they
pertain. As will be seen, the tables which have been con-
structed combine, for each variable, the data covering the
groups, functional areas, and organizational levels.
Previously mentioned was Figure l, Stratigraphic
Pattern of the Survey. This is a graphic depiction of
the strata--broad functional areas and organization
levels--into which the survey sample is divided. The
data compiled in accordance with this structure form the

basis for dealing with Research Hypotheses 2, 3, 4, and 7.

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The Questionnaire and Instructions

(a) It was felt that a clear and relatively com-
plete explanation of the nature and purpose of the survey
to the prospective respondents would serve to secure a
higher degree of cooperation as well as a more intelligent
and appropriate response than one which tried to obscure
the issues involved. A copy is included in the Appendices.

(b) Part I - Personal Profile. Along with the
usual kinds of information as to the respondents' personal
characteristics and background, a number of others were
included Which it was felt would have a bearing on the
respondents' attitudes and perceptions; (l) a record of
military service might result in a predisposition toward
authority recognition; (2) membership in fraternal and pro-
fessional organizations might reflect in the respondents'
greater self-awareness of personal and professional integ-
rity; (3) whether a respondent has studied subjects such
as religion, ethics, logic, or psychology might give him
a different perspective of a given situation and perhaps
be reflected in the Case Problem decision choices. Inas-
much as the survey is strongly exploratory in nature, data
was sought for consideration which would be reflected in
response patterns or trends, and if significant, might be
amenable to cross correlation with other factors to deter-

mine detectable influences in decision situations.

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41

(c) Part II - Influences on Decisions. This
researcher has long been aware of the fact that the man-
ager frequently faces a dilemma in making decision choices
because other than purely economic, technical, or broadly
situational factors impinge. For example, his judgment,
after giving due consideration to all relevant variables,
may be influenced by what he feels his immediate super-
visor may "prefer," which may not be in consonance with
the facts as the decision maker has evaluated them. Many
such influences bear on the manager. The Part II list of
influences is "representative" but is also designed to
determine if the respondent, as he rates them on a seven-
point scale, is more sensitive to authoritative factors,
the interests of the organization generally, or his own
personal interests. This trichotomous structure is anal-
agous to the Jennings' A O 8 frame concept1 and to an even
more basic physical/mental/spiritual View of the human
individual's dimensions, in line with the "whole man"
concept, which is being increasingly stressed in behav-
ioral literature. The data compiled under Part II will
form the basis for dealing with Research Hypothesis 5.

(d) Part III - Environmental Factors. Similarly
to the data for Personal Profile, some of the data
gathered under Part III are reviewed for significant
trends and patterns which might have a meaningful corre-

lation with the decision choices of the case problems or

 

1Jennings, Executive in Crisis, p. 130.

 

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42

with the influence ranking under Part II. While the
respondents' perceptions of their interpersonal relations
are specifically correlated with the case problem deci-
sion choices in dealing with Research Hypothesis 7, the
respondents' perceptions of the general ethical climate,
or of the individual personal situation may be similarly
used.

(e) Part IV - Case Problems. The case problems
are drawn from actual occurrences observed in various
industries by this researcher. Informal review by asso-
ciates (as well as by personnel executives of an indus-
trial firm in which a management survey was discussed)
disclosed no difficulties. One individual even commented
that Case 4 accurately described a sales executive in his
own experience.

While quite technical in content, they do portray
the kinds of situations frequently encountered in the
industrial context. They are somewhat ambiguous, and
justification may be reasonably made for at least two or
more combinations of decision Choices in each case prob-
lem. Case 1 identifies the respondent only with "your"
company, but not with a specific role or function. How-
ever, Cases 2 through 4 are so worded as to place half
of the respondents in_a specific role and the other half
as observers of a specific role. The responses to these
subjective vs objective modes are compared as a basis

for dealing with Research Hypothesis 1.

In ea:
inizcate uh;

Part II ente:

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43

In each case problem the respondent was asked to
indicate which three of the influences he rated under
Part II entered most strongly into his decision choices
or opinions. This may have caused him to try to "justify"
the choices he made, or to rethink the problems and per-
haps alter his choices to better coincide with the
influences he may have considered as having greater
importance. Alternatively, some respondents might have
concluded that the ratings of significance they set up
in the Part II were not necessarily applicable to the
particular situations they perceive in the case problems.
No absolutely right or wrong decisions are represented
for the case problems. However the action choices are
reviewed and evaluated in accordance with the criteria
discussed in Chapter I, a framework having been set up
which takes into account whether, and to what extent,
such factors as intentions, means used, consequences
perceived, technical and prudential considerations, jus-
tice, moral imperatives, absolute and relative values,
and the like can be given consideration. In addition,
and by way of contrast, the presence of a "norm" based
on the "concensus" of action choices by the respondents
is also considered. Since each respondent chose,
usually, two or more action choices for each case prob-
lem, these constitute "patterns" and the responses are

grouped accordingly. Thus, it is the patterns, rather

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44

than individual action choices, which are evaluated for
"solution content." Each such pattern is given a scale
rating from 1 for the most complete solution, to S for the
least complete solution. The rating scales for all the
case problems are shown together on one figure which
accompanies the analysis and discussion of the actual cases
later on. To explain briefly, all the proposed solutions
for each case have been consolidated into nine patterns on
a "best fit" basis-~many are of course identical-~and these
patterns are analyzed to determine how completely, relative
to each other, they appear to provide a satisfactory solu-
tion to the problem. This evaluation is somewhat arbitrary,
but it is applied uniformly by way of the rating scale to
the solutions of each respondent. The ratings are sub-
sequently compiled by functional areas and organizational
levels to determine their "solution perceptiveness" as a
test of Hypotheses 2 and 3, which consider if the managers
in these areas and levels will have different perceptions
of the solution possibilities of ethical problems.
Separately from the tests of overall completeness
of the solutions, another evaluation is made based on the
extent to which the action choice patterns appear to re-
flect prudential concern (for self or company) as opposed
to justice for others. This is a test of Hypothesis 4,
which considers if managers in different functions will

reflect a different proportion of prudence vs justice in

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45

their solutions to ethical problems. The evaluation cri-
teria are also among those mentioned above, and are brought
into view in later specific discussions of the case prob-
lems in the form of a schematic, previously mentioned. The
relative proportions of prudence and justice are expressed
as two percentages which equal 100 per cent, and the dif-
ference between the two percentages is taken as indicating
in which direction and how far the respondents appear to be
biased in favor of prudence or justice. A zero score would
indicate that the respondents have equally balanced pru-
dential concern and justice for others.

Since this is an exploratory program, it falls
upon this researcher to experimentally apply the criteria
as objectively as possible and to consider as many alter-
natives as appear to be reasonable. It is stressed, also,
that precisely how correctly the criteria are applied--
and individual judgments will differ--is lessimportant
than to establish whether or not there are significant
differences as between the choices of the groups, areas,
or levels. In other words, the Hypotheses to be tested
are not whether one or another is more or less ethical,
but whether it is possible to determine if their percep-
tions of solution possibilities for ethical problems
differ, based on common criteria.

The question may well be asked, "Why bother with

evaluating the choices at all--why not merely determine by

"out whethe.
areas, or 1e

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46

count whether the choices, as such, of each of the groups,
areas, or levels do differ significantly? This, too, is
done--in a preliminary analysis of each case problem. How-

ever, this does not provide an answer to the dilemma voiced

 

by Mr. Koch, as cited in Chapter I, "how, when, and which:-
(rather than) whether to be ethical." He seems to be
saying that businessmen know they should be ethical but
need some kind of generally accepted standards or guides

by which to determine how best to resolve ethical problems
in the business context so as to most completely satisfy
all concerned. Thus, this study experimentally tests the
feasibility of applying such a set of ethical criteria, and
the respondents' patterns of action choices provide the

vehicle for such a test.

Tables and Tests

 

Uniform sets of tables were structured for each
part of the questionnaire in such a way as to provide a
direct comparison of data, in appropriate form, between the
groups, areas, and levels. The findings so depicted are
analyzed and discussed, in the same sequence of groupings
as the related questions appeared in the questionnaire.
The applicable tests of statistical significance are in-
corporated in the tables. The next chapter considers the
findings relative to Parts I, II, and III of the question-
naire, covering the personal, influential, and environ-

mental variables associated with the respondents.

CHAPTER III

FINDINGS: PERSONAL, INFLUENTIAL AND
ENVIRONMENTAL VARIABLES

Introduction

 

In this chapter an analytical comparison is made of
various characteristics of the respondents. The essential
objective is to identify those variables with respect to
which the groups, functional areas, and organizational
levels may significantly differ from one another, and which
may help to explain differences in their orientations within
the industrial organization, and provide a basis for deter-
mining whether, and perhaps a rough measure of the extent
to which, their perceptions differ with respect to problem
situations which involve ethical considerations. In view
of the disparate sizes of the groups, area, and levels the
raw data have been converted to the common denominator of
percentages, and in some cases to medians or means. The

following three sections each deal with a major group of

 

variables corresponding to the first three parts of the
questionnaire. However, only those variables which reflect
statistically significant differences among the groups,
areas, or levels are discussed in detail; the others are

mentioned and then dismissed from further consideration.

47

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48

Wherever possible, all data for each variable have
been combined into one table. The structure followed is to
first compare the two major groups within the total popu-
lation sample, then the area and levels within this total.
Following this, a similar comparison is made of the areas
and levels which comprise Group 1. ‘As previously mentioned,
Group 2 is too small in itself for similar treatment to be

meaningful, although some exceptions are made.

1. Findings: Personal Profile Variables
Sixteen sets of questions consisting of thirty-three

items of detail were included in Part I of the questionnaire.
There were no statistically significant differences (at p =
.05 or less) among the groups, areas, and levels with
respect to the following:

Sex; all cooperating respondents are males.

Race; all respondents but one are Caucasian.

Nationality; not significant in the present sample.

Birthplace; not significant in the present sample.

Home State; one state named by 83 per cent of the

respondents.

Marital Status; all but one respondent are married.

Number of Children; not significant for this sample.

Military Service; not significant for this sample.

Education-~High School; completed by all respondents.

Education--College Major, Group 1; not significant.

Parents' Vocation; not significant for this sample.

Parents' Religion; same as respondent's in most cases.

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49

The following personal profile variables were found
to differentiate the groups, functional areas, or organiza-
tional levels to a statistically significant degree, and the
discussions are supported by accompanying tables:

Age; The median age of the total population is 43.5
years, that of Group 1 is 41.0 years, and Group 2, 49.5
years. Thus the difference between the two groups is 8.5
years. Generally, the older manager is thought of as being
more conservative, more experienced, and having more mature
judgment. This is taken into account when the case problems
are reviewed and a comparison is made between the upper and
lower halves of the age range of the sample. There is no
statistically significant difference among the functional
areas either of the total sample or of Group 1, but it is
noted that the Engineers are a bit younger than the rest.

In terms of organizational levels the differences are nor-
mal in that ages are expected to be higher in higher levels.
The details are given on Table l.

Education--College; The median number of years of col-
lege for Group 2 is half that of Group 1, and this carries
over into the organizational levels for the total sample,
but only because Levels 1 and 2 are entirely from Group 2.
The differences are not statistically significant as between
the functional areas, but within Group 1 there is a rise in
the number of years from level 1 to level 3. This variable
appears to have importance in that a higher degree of

technical competence usually accompanies a higher level of

 

 

 

 

 

 

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51

education. This will be considered in analysis of the case
problem solutions. The lower educational level of Group 1
respondents may correlate to some extent with their higher
age levels, many of them having been of college age during
the depression years when a college education was out of
reach for many individuals with limited financial means.
The details of this variable are shown on Table 2.
Education--Degrees; The data for this variable are, of
course, consistent with the above findings with respect to
years of college education. Only the comparison between
Groups 1 and 2 is statistically significant. In Group 1
only 11 per cent had not completed work on a bachelors de-
gree, while 57 per cent of Group 2 respondents have no de-
gree. At the bachelors level the difference is small--33
per cent to 29 per cent in favor of Group 1, while at the
masters level the contrast is much greater--53 per cent to
14 per cent in favor of Group 1. Similar comparisons per—
tain to Levels 1 and 2 because they are entirely Group 2
respondents. Details are shown on Table 3.
Education--College Major; One of the objectives in this
analysis is to determine if there are any incongruencies be-
tween the education majors of the respondents and their work
in industry, since appropriate technical background is imr
portant in solving technical problems. With respect to this
variable the difference between Group 1 and 2 is again sig-
nificant because only 50 per cent of Group 1 have degrees.

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54

years of practical experience. Significant differences
exist, as expected, between the functional areas, both in
total and in Group 1. These are normal, since most functions
require an educational background consistent with the nature
of the function-~engineers work at engineering, accountants
at accounting, etc. Personnel and Marketing tend to make
use of specialists, the former for training, and the latter
for technical service to the customer, so some mixture in
these areas is to be expected. These differences are not
visible in the organizational levels. Another aspect of this
variable is that acquisition of a purely technical education,
if not accompanied by some exposure to the humanities or the
behavioral disciplines, might be reflected in a manager's
excessively impersonal approach to ethical problems. These
educational variables will be discussed when the case prob-
lems are reviewed. Details of the distribution of the edu-
cational majors are shown on Table 4. ,
Religion--Denomination; Religious affiliation is one of
the most significant differences between Groups 1 and 2,
primarily due to the fact that Group 2 are predominantly
Baptists--57 per cent, with Presbyterians and non-denomina-
tional Protestants making up most of the balance. By con-
trast, Group 1 includes 44 per cent Roman Catholic, 43 per
cent in various Protestant denominations, 7 per cent Judaic
and other non-Christian, and 6 per cent non-responsive.
However, these differences are not significant as between

areas or levels, being fairly evenly dispersed. Group 2

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56

is at the conservative end of the religious spectrum, as
will be evident in the following two associated variables.
These characteristics form the basis of differentiation with
respect to Hypothesis 6, which considers if the more re-
ligious manager is more concerned about the interests of
others and less about his own than the less religious mana-
ger. Details of the denominational differences are shown

on Table 5.

Religion--Position; This is one of the more meaningful
items of information, inasmuch as whether a respondent con-
siders himself religiously a conservative, moderate, or
liberal may indicate the degree of his commitment to moral
imperatives in the ethical context. Eighty-nine per cent
of Group 2 respondents identified themselves as conserva-
tives, as compared with 29 per cent in Group 1. These dif-
ferences are dispersed in the functional areas and organi-
zational levels, except for Level 1 and 2, which are all
Group 2 respondents. Details are given on Table 6.

Religion--Importance; The respondent indicated how im-
portant his religion was to him by use of a seven-point
scale. The difference in overall rating between the two
groups is considerable, Group 1 being 4.7, and Group is
6.9. While the differences among the areas and levels are
not statistically significant, in part because of the dis-

persion of Group 2 respondents, an interesting progression

 

 

 

 

 

 

 

 

 

 

 

 

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59

is visible in the functional areas of Group 1, where the
ratings range from a low of 3.9 for Accounting/Finance/
Systems, to 4.7 for Personnel & Administration, 4.9 for
Engineering, 5.3 for Marketing, and 5.4 for Manufacturing.
It appears, from examining the previous tables on denomi-
nation and position, that Roman Catholic tendency toward
conservatism is modified by Protestant moderates to pro-
duce this result. Details of the ratings are shown on
Table 7.

Membership in Fraternal Order; Many fraternal orders
have strong religious and ethical bases, and members may
be more sensitive to ethical issues, which explains why
this variable is included. The difference is statistically
significant only between Groups 1 and 2, who acknowledge a
membership, respectively, of 37 per cent and 7 per cent.
It should be explained that most Group 2 respondents heed
the Scriptural admonition against oath-takingl which is
why so few of them belong to secret fraternal orders such
as the Masonic order. Table 8 shows details for both fra-
ternal and professional affiliation.

Membership in Professional Group; This variable also
has importance as an indicator of the respondents' adher-
ance to a code of professional ethics, such as that of the

Certified Public Accountants, or of professional standards,

1Holy Bible, King James Version (Scofield ed.;
NEW York: Oxford University Press, 1945), Matthew 5:33-7.

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62

such as the Society of Automotive Engineers. Sixty-six per
cent of all the respondents belong to a professional group,
but the differences in proportionate membership are signifi-
cant only in the organizational levels, where a higher per-
centage of membership is evident in higher levels. This is
true of both Group 1 and 2. In the functional areas, Mar-
keting and Engineering are somewhat lower than the other
three areas. Details are provided on Table 8.
Parents'NEducation; While the educational level of the
fathers of Group 2 respondents is somewhat lower than those
of Group 1, the difference is not statistically significant.
In contrast, the educational level of the mothers reflects
a considerable difference as between the two groups. This
carries over into Levels 1 and 2. The lower educational
level of Group 2's mothers may be due to the fact that
they identify with a generation ten years earlier than
that of Group 1, their school years coming before World
War I, when there was less stress on education for girls.
These variables add weight to those already discussed,
and will be further considered when the tests of correl-
ation are examined. Table 9 provides details on the edu-
cation of the parents.
Personal Activities/Interests/Goals; The respondents
were requested to indicate, in rank order, their three
most important activities, interests or goals. The results

were consolidated into nine categories. There was a

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64

statistically significant set of differences only with re-
spect to the two groups. While both groups place Family,
Work, and Self-Improvement high and in the same order, the
point of interest is Church and Spiritual Activities, which
Group 1 ranks last, and Group 2 first. Also, Group 1 ranks
Financial Security fifth, and Group 2 eighth. They are in
general agreement for all other interests as far as order
of importance is concerned. It is also of interest to note
that the percentage totals (as seen on the related tables)
for each group for Family and Work are very similar, and
that the high percentage of Group 1 for Church and Spirit-
ual activities results in very low percentages in the re-
maining areas. In other words, Group 2 is as much concerned
about Family and Work as Group 1, but gives its primary con-
cern to its spiritual outreach in lieu of most other activ-
ities. Although the Chi Square tests indicated signifi-
cance only at the group level, as seen on Table 10, the

five additional tables--ll through lS--have also been in-
cluded to enable the interested reader to see how the
functional areas and organizational levels in bgth_groups
ranked the nine categories of activities. For example,
after WOrk and Family, which all but Marketing rank in first
or second place, Engineering ranks Hobbies, Personnel and
Administration ranks Community Affairs, and the others Self-
Improvement. In Group 2 functional areas, Marketing ranks

Financial Security in second place and Family fourth. The

 

 

 

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TABLE lO.-Personal activities/interests/goals-distribution by major groups (N=101).

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N=73
Group 2
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rankings of these personal activities serve as clues to
indicate how the respondents equate personal interests as
opposed to interests of (or in) others. This is of interest
with respect to Hypotheses 4 and 6.

Study of Religion, Ethics, Logic, Psychology; This is p»

.. 251%.!

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the final set of variables in the Personal Profile section.
At the group level, more of Group 2 respondents have
studied religion and ethics than Group 1, proportionately
speaking, while the reverse is true of logic and psycho-
logy. In the functional areas, a statistical significance
pertains only to the area of ethics, and the greatest dif-
ference is found between Engineering, of whom only 9 per
cent had studied ethics, compared with 63 per cent in Mar-
keting. The same degree of difference is seen in Group 1
functional areas alone. With respect to the study of

these four important topics, a previous comment was made

in discussing the educational levels of the respondents

and their major areas of study, that exposure to the human-
ities and behavioral disciplines might be desirable to
counter any tendency on the part of managers to be exces-
sively impersonal, with only a purely technical background.

«Details are shown on Tables 16 and 17.

Summary of Section 1
The groups, functional areas, and organizational
JJevels are differentiated to a statistically significant

degree with respect to the following variables: Age,

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74

College Education (years, degrees, major), Religion (de-
nomination, position, importance), Memberships in Fraternal
and Professional Groups, Parents' Education, Personal Ac-
tivities/Interests/Goals, and Study of Religion, Ethics,
Logic, and Psychology. These findings will be drawn into
later analyses of the case problems and in connection with

discussions of the tests of the research hypotheses.

2. Findings: Influential Variables

In Part II of the questionnaire, the respondent was
requested to rate, on a seven-point scale, each of a list
of influences which may, under various circumstances, enter
into the manager's considerations in making decisions, or
which may have a subconscious effect on his judgment or
choice of alternatives. These eighteen influences have
been differentiated into three categories--those identi-
fiable with some form of authority, those concerned with
some aspect of the organization, and those with respect to
which the manager's self-interest is paramount. Figure 2
depicts the arrangement. For purposes of this research,
these influences are viewed in several ways, which include
the following: those with respect to which the groups,
areas, or levels differ to a statistically significant de-
gree; those with respect to which they closely agree; and
the way they are ranked relative to each other within the
groups, areas, and levels. For convenience in comparison

and analysis they have been arranged on four sets of tables

75

 

(Numbering in Accordance With Questionnaire)

 

Authority Orientation

 

 

 

 

 

1. Company Policies/Procedures
2. Top Management Attitude
3. Your Supervisor's Attitude
10. Own Ethical Standards
11. Own Religious Beliefs
12. Legal Constraints
Organizational Orientation
4. Company Economic Interests
5. Your Peer Group's Attitude
6. Customer/Supplier Welfare
13. Company's Reputation
14. Subordinates' Attitude
15. Society's Interests
Self Orientation
7. Wife's/Family's Attitudes
8. Own Economic Interests
9. Own Professional Competence
16. Fear of Losing Job
17. Own Personal Integrity
18. Own Career Aspirations

 

Figure 2.--Inf1uences--Classified by A-O-S Orien-

tation.

 

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76

according to groups, areas, and levels, including those
under Group 2. The level of statistical significance is of
minor importance due to the fact that, under the standard
computer program used, this deals with the relative fre-
quencies under each of the seven scale positions. Of more
significance are the mean ratings and the resulting rank
positions. Tables 18 through 21 show the details.

Company Policy: This is an authority-oriented item in
terms of its effect on decision-making. Under normal con—
ditions decisions are made in accordance with applicable
policy, stated or inferred. Most respondents ranked this
influence about mid-range, but Manufacturing ranked it in
6th place and Level 5 ranked it 2nd.

Top Management's Attitude: An authority item, ranked
in mid-range by most, but Personnel and Administration
ranked it 5th and Level 4 ranked it 7th.

Supervisor's Attitude: Also an authority item, there
is disagreement, Group 1 ranking it 7th, but Group 2 ranked
it llth. Engineering ranked it 5th, while Marketing and
P & A ranked it 13th. There are quite obviously mixed
feelings as to the relative importance of Top Management
vs the Supervisor in the manager's decision-making.

Company's Economic Interest: An organization-oriented
item, it is ranked high--4th--by most, but surprisingly,

P & A ranked it 14th. This may be a clue to the way they

perceived the case problem solutions.

77

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84

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Peer Gro 1;

respondents j

pparent the;
give much Co ;

t

}._l.

part, Why SO I”
in a case pr ,1

Customer ’3
oriented ite 1
Group 1 Plac r

nOtEWQI-thy t

w
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85

Peer Group's Attitude: An organization item, most
respondents ranked it very low, 16th or 17th. It is
apparent that the managers in the present sample do not
give much consideration to the attitudes of their asso-
ciates in making their decisions. This may explain, in
part, why so many respondents chose to "confront" a peer
in a case problem dispute.

Customer/Supplier Welfare: Also an organization-
oriented item, there is a wide range in the ranking, with
Group 1 placing it 12th, but Group 2 ranked it 4th. It is
noteworthy that Marketing ranks this influence 3rd, in con-
trast to about 11th by the other areas. Levels 1 and 2
also rank it about 5th, while the other levels go as low
as 16th. These rankings will also be taken into account
in the review of case problem solutions.

Wife's/Family's Attitude: Surprisingly, and in strange
contrast to the importance given to Family in ranking per-
sonal interests under Part I, most respondents ranked this
self-oriented influence almost the lowest--l6th or 17th.
A/F/S and Level 5 in Group 2 rank it 4th, in further con-
trast to the others.

Own Economic Interests: Another self-oriented item,
it is ranked below mid-range by most respondents, except
for Group 2's P & A and Level 1, who ranked it 7th. No

relationship can be drawn with the case problems.

Own Profes
influence is z
the range is f
and Level 5.

Of this item a
0m Ethica
V

PCrtut for th

With others it

 

86

Own Professional Competence: Also self-oriented, this
influence is ranked 2nd by Group 1 and 5th by Group 2, but
the range is from lst for Level 4, to 11th for Engineering
and Level 5. The respondents appeared to be quite aware
of this item as identifying with the case problems.

Own Ethical Standards: An authority item, this repre—
sents a form of authoritative guide to behavior, quite im-
portant for the professional like a CPA oriented accountant.
With others it may be less specific but is ranked very
high, 3rd by both groups, and even lst by some of the
areas. This influence was cited frequently in connection
with the case problems. Since it is ranked so much higher
by all respondents than Company Policy, Top Management or
Supervisor's Attitudes, it appears that it would take pre-
cedence in a conflict situation.

Own Religious Beliefs: Also an authority-oriented in-
fluence for purposes of this study, particularly because
of the inclusion of the religious sample which constitutes
Group 2. Scriptural authority is as much an authoritative
guide to the religious manager as codes of professional
conduct and company policy manuals, not for technical pur-
poses but in interpersonal relationships-~in his conduct as
a human individual. On this influence Groups 1 and 2 part
company. Group 1 ranks it 15th, while Group 2 ranked it in
2nd place, but actually tied for lst place. This high
ranking is evident in Group 2's functional areas and organi-

zational levels, while the converse is true of Group 1,

87

although their P a A and Marketing areas ranked it in 10th
and 11th place. Thirty per cent of Group 1 respondents did
actually rate this influence at 6 or 7, but the remaining
70 per cent had a much lower rating, resulting in an average
rating of 4.15 as compared with 6.78 for Group 2. It seems
apparent that Group 2 respondents attach a great deal of
importance to spiritual guidance in their decision-making,
as well as considering the prevailing ethical standards.
This characteristic is, of course, taken into account in
later analysis of the case problems and in testing Hypothe-
sis 6.

Legal Constraints: This is the sixth and last authority
item, and both groups ranked it 8th. There is some dif-
ference in Group 1 as Engineering ranked it 6th while Mar-
keting ranked it 16th. Also, the levels ranked it progres-
sively higher-—5th, 7th, and 9th, going from fifth to
third level. It would appear that the respondents in this
sample had not encountered any difficulties with this kind
of constraint in their experiences.

Company's Reputation: This organization-oriented
influence is ranked quite high by most respondents, 6th
and 7th by Groups 1 and 2. In Group 1 it was ranked 5th
by Marketing, P a A, and A/F/S. There was awareness of
this influence in the case problem citations.

Subordinates' Attitudes: Also an organizational in-
fluence, the rankings are rather low, 17th by P & A. In

Group 1 a progression is seen as the rankings are llth,

 

14th and 16th
seems that hi;
nates attitudi
verse seems t;

Society's
”Wization C
1'NISJ'JlESs, ente:
Grcup 1' “he“

Fear of L;

Ii‘ified lowest

Pl ace . HOWe VE-

Progressive 1y

‘i ‘&

m‘" and de:
Group 1 respor.
this influence

1 N

It is ratEd 111'
rated and ran}:
mean)“ for t
eve“riding ir‘l

”ESSUres. F

M Career

3::
ented influ.
I; Quit

e strOn,

 

88

14th and 16th going up from fifth to third levels. It
seems that higher levels have a lower regard for subordi-
nates attitudes than lower levels of management. The con-
verse seems to be evident in Group 2's levels.

Society's Interests: This is also identified as an
organization oriented influence, in the context of the
business enterprise. Ranking is uniformly low, except in
Group 1, where P & A ranked it 8th.

Fear of Losing Job: This self-oriented influence is
ranked lowest by far by all respondents--uniformly in 18th
place. However it is noted that the values of the ratings

progressively increase as the levels go down from first to

 

fifth, and details of the data input clearly show that some
Group 1 respondents in lower organizational levels give
this influence more significance than most of the others.

Own Personal Integrity: In direct contrast with the
last, and almost without exception, the responding managers
attach primary significance to this self-oriented influence.
It is rated highest and ranked lst by Group 1, and Group 2
rated and ranked it in a tie for lst with Religious Beliefs.
Clearly, for the respondents in this sample, it is the
over-riding influence, at least in the absence of other
pressures.

Own Career Aspirations: This is the last of the self-
oriented influences and the last in the list of eighteen.

In quite strong contrast, Group 1 managers rank this 5th,

 

 

while Group 2
fact, as brou
respondents a
are most Grog
_ I
Authority
earlier, the ,
0f three "ori-
Mn values Si
into the threl
rating in the
then ranked a
areas: and 1e.
4.
10"e .
‘ " r Portion

i

 

89

while Group 2 ranked it 15th. This is consistent with the
fact, as brought out in later analysis, that Group 2
respondents are less concerned with self-interest than
are most Group 1 managers.
Authority/Organization/Self-Orientation: As mentioned
earlier, the eighteen influences identify with the pattern
of three "orientations" shown in Figure 2. The weighted
mean values shown on Tables 18 through 21 were consolidated
into the three categories and averaged to a unit level
rating in the l to 7 range. The resulting ratings were
then ranked as lst, 2nd, or 3rd, for each of the groups,
areas, and levels. Table 22 gives the details for the
total sample and Group 1, while Group 2 details are on the
lower portion of Table 21. Both groups give Authority-
oriented influences the highest ranking in the aggregate,
but Group 2 much more so, due primarily to their much
higher rating of the influence, Own Religious Beliefs. In
the case of OrganizatiOn-oriented influences, Group 1 ranks
this category 3rd, while Group 2 ranks it 2nd. In the
areas and levels, Marketing, A/F/S, and Levels 1 and 2 rank
the category in 2nd place, while all the others give pre-
cedence to Self-oriented influences. By contrast, Group 2
areas and levels rank the Organization-oriented category
2nd and Self-oriented influences 3rd, with two exceptions.
There are implications that the Organization-oriented

manager may exhibit evidences of a higher degree of maturity,

90

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um x m\m\< ¢am 02m 09%: mm: coHumucmHuo

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91

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as has been i
that individa
what Jennings
ception of 5.}
attach inordi
ences and the
Jennings con:
56 fraitful.
alalysis of 1
research hyp:

Sm.

4113‘

The c

d

1

levels are d:

respeCt to th
Attitude: C118
petean' OWn .'
Inii‘lidual <31“;
3

Cte ' .

D
f
)1 1'
— — — —

 

92

as has been indicated by Jennings.2 It is also possible
that individual respondents in the total sample may exhibit
what Jennings terms AOS imbalancesB--distortions in per-
ception of self, boss, and company--if such managers

attach inordinate significance to certain groups of influ-
ences and the measurement method used here is valid in the
Jennings context. Further research in this direction may
be fruitful. The rankings noted are considered in later
analysis of the case problems and discussions of the

research hypotheses.

Summary of Section 2

 

The groups, functional areas, and organizational
levels are differentiated to a significant degree with
respect to the following influence variables: Supervisors's
Attitude, Customer/Supplier Welfare, Own Professional Com-
petence, Own Religious Beliefs, and Own Career Aspirations.
Individual areas and levels also seem to have special char-
acteristics, and the overall relative ranking of the
eighteen influences gives clues as to which would seem to
enter most strongly into the decision making process. It
is clear that the managers have a high self-image. When
the influences are categorized, it also appears that
Group 1 managers have stronger self-interest than those

in Group 2, consistent with Section 1 findings.

 

2Eugene E. Jennings, The Executive in Crisis, MSU
Business Studies (East Lansing, Midh.: Bureau of Business
and Economic Research, 1965), p. 138.

3

 

Ibid., p. 132.

93

3. Findings: Environmental
Variables

 

 

This section explores the conditions surrounding
the manager in his position in the organizational hierarchy
and functional structure, which may also have a bearing on
how he approaches work—related problems. Thirteen sets of
questions consisting of twenty-seven items of detail were
included in Part III of the questionnaire. To the extent
possible all data dealing with a single variable have been
combined in one table and the item is analyzed at the same
time in the three contexts of group, functional area, and
organizational level.

Many researchers have investigated the effects of
organizational environment on worker motivation and produc-
tivity, notably Herzberg1 who talks in terms of "hygienic
factors," and Maslow2 with his "hierarchy of needs." There-
fore, there is no doubt as to the importance of these vari-
ables as they affect managerial decision-making. Decisions
are too often thought of in a highly formal sense, and as an
activity primarily in the purview of higher levels of manage-
ment, when in fact almost every conscious and deliberate act

is the result of a decision to do it. In the organizational

 

1Frederick Herzberg, et a1., "Motivation Versus
Hygiene," in People and Productivit , ed. by Robert Suter-
meister (New York: McGraw-Hill,_l 3), pp. 492 ff.

 

2Abraham Maslow, Eu 3 chian Mana ement: A Journal
(Homewood, 111.: Richard D. Irwin, Inc., 1 ).

 

situation it

as sending a
sonally, in ,
indicative 0:

General 3
t"*0 elements I
plaif‘iEG (m P;
se‘CELIenCe are
Kahuna-3;

P V
010;}

P 1: and
38.4 Per Ce!“
Gealt with ir.

absolute Size

Details are
Specific

an

yuces exis t

ticnal arEas ' I

201711.31 f0:

 

 

94

situation it might be something as simple (but significant)
as sending a report to a superior, instead of taking it per-
sonally, in order to avoid a confrontation, which might be
indicative of interpersonal stress.

General Functional Area: This variable is one of the
two elements of the stratigraphic pattern shown and ex-
plained on Figure l in Chapter II. The differences of con-
sequence are in the relative percentages of respondents in
Marketing-~32.l per cent for Group 2 vs 9.6 per cent for
Group 1, and in Engineering--l7.9 per cent for Group 2 vs
38.4 per cent for Group 1. However, most of the data is
dealt with in the common denominator of percentage so that
absolute sizes of areas and levels are of minor importance.
Details are in Table 23.

Specific Functions: Statistically significant differ-
ences exist as between the two major groups, the five func-
tional areas, and the five organizational levels. This is
normal for the five functional areas, since the specific
functions should naturally fall into categories appropriate
to the general functional areas, although with some excep-
tions, as each area may make use of specialists for various
reasons, such as technical engineering liaison in Marketing.
However, the differences between the groups and Levels is
partly due to the fact that there are twenty-five specific
functions identified, of which twenty-one are represented in

Group 1 and fourteen in Group 2, with fifteen appearing in

95

 

 

000. u m u$6M u Nx Nmo. n m uNH.N u Nx "caaaam Haw
m.mN w.Nm N.wN o.m m.w m.HN m.mH N.Nm m.mH m.mH c.00H Haaca
m.NH m.NH e.HN m.NH o.mN v.HN m.VH m.NH H.Nm m.aH N.NN N macaw
o.wN N.m¢ m.mN . u m.HN v.wH «.mm w.m N.mH m.NN H macaw

musmwcommmm
mo mmmusmoamm
«N mm NN m N NN wH mm wH «H HOH Haace
m m w m N w a m m a mN N macaw
mH mm HN . . wH NH mN N OH mN H macaw
mucmpcommmm mo .02
mug and mug Nun H-H m\m\a «am wzm wax: was mHmaca

 

.mmsoam an mucmccommma mo comm HMGOHDMNHcmmao can moan HmGOHuocsm Hmumcmwul.MN mqmda

—7

 

either one 9

    

this diversi‘
small total

scope of the
deal with th,

96

either one group or the other and only ten in both. Whether
this diversity in technical competencies, for a relatively
small total sample, has a detectable bias is outside the
scope of the present study. In the present analyses we can
deal with them only in terms of the five general functional
areas into which they fall. Later-analyses will give con-
sideration to the possibility of bias resulting from differ-
ences in the technical backgrounds of the respondents in
their various functional roles, much as might their educa-
tional specialties. Tables 24, 25 and 26 show the details.
Organizational Level: This is the other of the two ele-
ments which make up the stratigraphic pattern. Levels 1 and
2 are unique to Group 2, and this is being kept in mind in
all analyses. As to the remaining three levels, it is ap-
parent that Group 1 has, proportionately, many more engi-
neers than Group 2, and this is considered in later analyses.
Subordinates Reporting Direct: There are no significant
differences between groups or among areas. In the Organiza-
tional Levels some differences might be expected, but it
appears that 79 per cent of respondents in Level 5 have no
subordinates, and in Level 4 approximately 30 per cent. This
would indicate that many of our management level respondents
are non-supervisory staff people or specialists of one kind
or another. This also reflects a rather general tendency in
large corporations to classify higher paid, non-supervisory

personnel at the managerial level in order to place them in

97

I I H H H m I I I I N H

I H I I H I I I N I H H

H H m H I I I I w I m N w
I H I I I I I I H I I H H
I N N I I I a I I I H N v
m m H I I I v I H N I N N
I H N I I I N I I I I m m
a N a I I m I m I H I 0H 0H
N v H I I m I N I I I N N
H m H I I I I m I I H v m
m e N I I H I c I H N a HH
m o N I I I I HH I I m m HH

nl

HI I‘MIHldjrar

Hcaczccfia .m H

QUCMQ

INK .aanmab .NH
INMC< IU¥2
\IEOHQ IUOMQ INN

mcH
Iumxumz .mmHmm
mcH
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waHaHaz
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Icam ..maz
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.oum
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.mcHammchcm

.H

 

mIa aIH NIH NIH HIH m\m\4 «mm wzm wax: wmz N maw H maw Hmaca acHacaam oHchcmm
m

VN mm 5N h NN mH mm wH vH mN mm HOH

 

mHm>mH HmsoHumNHcmmao mmmud HMCOHuocsm mmsouw Hons:

"z

 

AHOHuzv Mom mHm>mH HmcoHumNHcmmuo

can .mmmum HmcoHuoc5m .mmsoum Honmfi an .mucmpcommmn mo msoHuosSM OHMHqumII.aN mqmda

 

98

 

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u m N8.2;
H I I

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mQOHDMHu

Iomwz uomuucoo

msHuoso

..EHumm .mmHmm

wonmfiuownmn
Honcm> ..nouam
Houu
Iacw maHHaao
msHussoood
mHthmcm
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moans
IHh .uHcmHU
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cHaamaa

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Hno

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.HH

 

 

99

I
Mr-Ir-II-Ir-IINI
r-ININII-II

m

I H N
v N a
N v H
H m I
v v H
N v N

lv-INI

I I H H N
I H. I N m.

I I I I N

I I I I H

I I H I H

I I m I m

I I H I H

m I I I N

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m I I I m

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I H I I H

I m I m a

I N I I N

Ia.u‘v..~ .Ir sq!" l

h. N

932a
IEHONMOQ RODEO; \.CUH3% .mw
NOMaCOU Nuwwwafi .mw

mcHu:30004 .vH
umeHmaa HchaaaHa .NH
moamsHm .uHUmxo .NH
.qud .uxz ..onm .uoum .HH
mcHumxumz .mmHmm .oH
maHHxam acawcam .m
.Hmm .msch .HmQGOmumm .m
maHaHaz
.msHsHmaa .soHuosxumcH .N
.mon>mo
.mcm éa: a .95: .w
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a .Hmc< .mamumwm .H
.oum
.zoxmmmmm .mCmemchcm .m
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..mmz .mcHHmmchcm .N
.Oum
.uosvoum .mcHHmmchcm .H

 

mIH HIH NIx NIH HIH m\m\< «Hm wzm wax: wm: H macaw

mH mm HN I I

mH

NH mN h 0H mh

 

mHm>mH HmcoHumNHcmmao

mmmam HmcoHuocsm

coHuocdm UHMHoQO
Hz

 

cam .mmmam Hm:0Huocsm an .H macaw .mucwusomwma mo

 

AmNqu mHm>mH HmcoHumNHsmmao

mcoHuocsm OHMHoQOII.mN mamae

 

'HHU—IHHH

coo.

m nS.SH

IMI-IIv—II
I

lr-ImI—INI—IH

N

"mamsvm H30

.umz oammmaa .msch
mmHmm .uxommam .cnome
maHaaaHm ..asta
mcHuwmchcm .uchS
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mcHammchcm mch>
.asm: c>HamaamHaHsc<
coauMHuommz uomxusou
mcHuoso ..EHumm .mmHmm
mosm
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Hcaaacw xaHHmao

.mN
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101

 

 

 

I N I I .. H H I I I N maHaaaHm ..aHec< .NN
I I I H H H N I H H m .asm: c>HuaaamHast4 .NH
H I I I ,I H I I I I H coHuMHuommz uomaucou .mH
I I I H H I I I N I N maHacao ..sHamm .mmHam .NH
I I N H I I I I N H m .Euomuwm Honsm> ..noxsm .mH
I I H I I I I I I H H Hcaaacw xaHHmao .mH
H I I I I H I I I I H msHuc50004 .HH
I I I H H N I I I I N mocwch .uHUme .NH
I I I I H I I I H I H .HMG<
.ax: ..Ecaa acawcam .HH
H I H H I I I I m I m msHummez ~mmHmm .OH
I H I I I I H I I I H .Hmm .mawcH .Hmcsomumm .m
I I H I I I I H I I H .oum
.nonmmmmm .maHHmmchcm .m
H I H I I I I H I H N .oum .mmwooxm
..mmz .mcHHmmchcm .N
H N I I I I I m I I m .cac
nonpoum .mcHHmmchcm .H
mIH «IA MIH NIH HIH m\m\< «am 02m 09%: um: N macaw sOHuocsm UHMHoQO
m m m m N m H m m H mN uz
mHm>mH HmsoHumNHcmmHo mmmxm HmcoHuozsm

 

.Amanv mebmH HmcoHumN
IHammxo new macaw HMCOHuosdm an .N macaw .mucmucommmx mo mQOHuocsm OHMHOOQMII.wN mamds

102

"exempt" categories because of overtime pay regulations, and
also, and perhaps largely, so they can communicate with
supervisory managerial personnel on a common organizational
level, thus limiting the need to go up and down chains of
command. One of the purposes in asking this question was to
provide a possible basis for detecting whether there is a
difference in the way supervisory and non-supervisory per-
sonnel view ethical problems involving subordinate-superior
relationships. Perhaps a companion question should also
have been asked--one which might disclose whether the non-
supervisors had ever had extensive supervisory experience.
Of interest is that two, three, or four subordinates is more
the mode than a larger number. Table 27 gives the details.
The patterns discussed will be considered in future analyses.

Subordinates Reporting Indirectly: There are no signif-
icant differences for groups and functional areas. The
organizational levels indicate a normal pattern since the
higher levels have responsibility for larger numbers of sub-
ordinates below them in the chain of command. No table is
provided.

Number of Employees in Division or Company: Group 2
respondents identify with smaller organizations. The reason
for asking this question is to see whether the usually
greater degree of impersonality and "organizational distance"
has a detectable effect on decision choices, in terms of

"persons" as such, involved. It had been established by this

UCaDkOQfil

 

 

IIIII.II

 

 

 

mIIH vIIH NEH NIH HIIH m\..x\< 4:: 02m 0.5.2 0.x! N mac H an Haaoa
VN an hm n A NN 0H MM cu VN QN MN HON l2
GH9>04 H6COHUQNHC¢3HO aqfih< HUCQNUUCJE IQJOMU Maxfl:

 

I I ~°>pb~ H INN-2‘ «H.H Wax-Ia? Ha.» Nat-.1
sl'-.fl' H'Cfluwdoczfi clan-40H) shad UCnuUr-Na.~l°:~ A... UU‘K‘kv NihflOINfiaainvh "U‘nmfluuhoanallIKN n‘s~u\‘~

11)3

 

 

 

 

 

 

 

 

 

 

OOO. I m NNO.HH I Nx HNH. I m «OO.HN I N: "maaaam Haw
I N.OH 0.0H m.NH N.O O.NH I 0.0H N.NH mac:
I O.N I N.O I I I I H.H anOHm
I I m.O I N.O I H.HH I N.N amamm
I I N.H I I O.N I I H.H wa
I H.O m.O m.NH I O.N H.HH I m.m maHm
m.OH O.N 0.0H N.OH N.N H.N H.HH I O.N aacm
N.m N.mH 0.0H I O.N O.NH H.HH 0.0N N.HH mmaaa
I N.mH m.O O.mN N.OH I I 0.0H 0.0 csa
I H.NH m.O I N.N H.N H.HH 0.0N N.N mac
N.HO 0.0N I O.mN N.HH O.NH 0.0N 0.0m O.mm mac:
a a a a O O a O a a a :HacmaHm
msHuuomom
mIH HIH HI: NIH HIH m\m\< <Hm wzm wax: wm: H macaw
OH NH HN I I OH NH ON N OH ON I:
mHm>uA HmcoHumNHcmmao uncut HmcoHuucdm
HOO. I m uHOOO I N: HOH. I m NmH.NN I N: ONN. I m nNH.O I N: “maaaam Haw
N.H N.OH m.OH I H.HH H.O m.NH N.HN I H.N N.OH H.NH H.HH mac:
I O.N I I H.HH m.H I I I H.N O.N H.H O.N aaOHm
I O.N H.N I H.HH m.H H.H O.N N.O I H.N N.N O.H amamw
I I N.H O.ON H.HH I N.O O.N H.O I H.N H.H O.N me
I m.m H.HH I I H.H I O.N N.O H.N O.N m.m O.m maHm
N.N N.m N.HH 0.0N I N.OH N.O H.O 0.0 H.N H.N 0.0 0.0 aacm
N.H N.OH m.OH I O.ON I N.H N.mH O.NH H.HN N.OH N.OH O.NH mmana
I H.NH H.N 0.0H H.HH H.NN O.mN I N.O H.N O.NH 0.0 O.HH c3a
N.H m.OH H.HH I I m.H m.O H.O m.NH H.HH H.N N.N O.N mac
N.ON 0.0N H.N 0.0N I N.NO H.HH H.NH H.HH 0.0N O.mN O.mN N.NN mac:
a a a H O H O a a a a H a mmmwmwmwm
mIH HIH NIH NIH HIH m\m\< «Hm wzm wax: wm: N maw H maw Hmaca
HN NO NN m N NN OH OH OH HH mN ON HOH I:

 

 

«Hw>oq HmcoHuMNHcmmao among HmcoHuocam mmsoau Hons:

 

.uHu>mH HmsoHumNHcomao can
.umoxm HmcoHuocdw .wanouu an unaccomwou on uouxwp mcHuxommu noumchaonumII.NN Hands

researcher i.
distance had
cation as pe
sis consider
this study.
Approxin.
aEipeau: to he
the function
distributed,

differenCe--

 

rise in hie:

VII .

“at Income

of security

are shOWn OI‘.
Ownershi

table Vas st

1 o
rower level

 

104

researcher in a prior study3 that increased organizational
distance had a negative effect on the quality of communi-
cation as perceived by senders and receivers. Later analy-
sis considers whether the same factor has significance in
this study. Details are in Table 28.

Approximate Annual Earnings: Group 2 owner-managers
appear to have higher incomes than Group 1 managers. Among
the functional areas, the income levels are fairly evenly
distributed. The organizational levels show the expected
difference--the rise in income level which accompanies the
rise in hierarchy. A primary reason for this question is
that income level might normally be tied to personal sense
of security and to satisfaction or dissatisfaction. Details
are shown on Table 29.

Ownership of, or Majority Interest in, Company: No
table was structured for this data, since all Group 1
responses were "no" to this question, they being middle and
lower level managers in very large corporations. Of Group 2
respondents, 29 per cent responded "yes," most being in
Levels 1 and 2, and they were distributed in four of the
five functional areas. Some Group 1 respondents indicated
that they applied a substantial percentage of their incomes
to acquire stock in the corporations which employed them,

possibly through "thrift-stock" programs, or the like, but

 

3R. J. Shuster, "An Experimental Quantification of
Communications Quality in an Industrial Organization"
(unpublished paper, Wayne State University, March, 1966).

 

 

 

    

 

 

mI; HI: NIH NI: HI: u\L\< <wa :2: max: 0L2 N Quu H QHO «much
am mm NN m N mm 3 mm wH H.H on MN I: I2
mH0>0Q HUCOHUQNHCUDHO a10h< HQCOHUUCJK DQSOHU HOfifiz

 

. IaHavxr'H. HUHNOflUQNfiC-QUIHQ 3:0
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105

 

 

 

 

 

 

 

 

 

 

 

HHO. I lOH.O I Nx OOO. I m uON.NH I Nx ”mamaam Haw
H.HN H.NH H.OO O.NO 0.0N O.HH O.HH 0.0N O.HN mac:
0.0H H.NH OIH 0.0 N.OH N.OH I 0.0H 0.0 OO0.0H
0.0H O.NN O.HH O.NH N.OH 0.0N 0.0N 0.0H O.ON. OOO.O
0.0N N.OH 0.0 0.0 N.OH H.HN. O.HH 0.0N H.OH OOO.H
0.0H N.OH 0.0N 0.0H 0.0N O.HH O.HH 0.0N O.NH OOO
0.0H N.OH 0.0 0.0H I N.OH 0.0N 0.0N N.OH OOH

sonH>Ho no
O O O O O O O O O O O xammscw aH
momhonem
OIH HIa OIH NIH HIH Oxmxm «Om wzm wax: wm: H macaw
OH OO HN I I OH NH ON N OH ON I:
mHo>oq HmcoHumNHsmmao mama: HmcoHuossm

OOO. I m uNH.OO I HOO. I m “HO.NH I Nx OOO. I m ONO.ON I N: "mamaaw Haw
0.0N N.OH 0.0N 0.0N I O.NN 0.0H N.OH O.NH O.HH N.OH O.HN 0.0H mac:
0.0 0.0H N.O I I O.H O.NH H.O I H.N I 0.0 0.0 OO0.0H
O.NH 0.0N O.HH I I H.O O.NH O.NN O.NH O.HH H.N 0.0N 0.0H OO0.0
0.0N H.OH H.HH I I H.O 0.0H N.OH 0.0 H.HN N.OH H.OH O.HH OOO.H
0.0 O.OH 0.0N I I 0.0H O.OH N.OH O.NH O.HH H.N O.NH O.HH OOO
N.ON O.OH O.HH 0.00 0.00H H.OO 0.0H H.NH 0.00 O.ON O.HO N.OH N.NN OOH

COHmHNer HO
O O O O O O O O O O O O O mammscw aH
womNOHmEm
OIH HI: OIH NIH HIH w\m\: «Om wzm wax: wm: N maw. H maw Hmaca
HN OO NN O N NN OH OO OH HH ON ON HOH I:
mHo>mq HmsoHuoNHsmmxo unmud HmsoHuocam wmsouw Hana:

 

.mHo>0H HMGOHDMNHcmmxo can
.mmmam HmsoHuocsm .mmsoam an .GOHmH>Hu Ho NGMQEOU .wucoosommmu CH momaonfim mo HwnfiazII.mN uqmda

106

 

 

 

 

 

 

 

 

 

 

 

 

HOO. I m OOH.HO I Nx OOO. I m.aHO.HN I N: umamaam Haw

I I 0.0 N.O 0.0 I I I N.N mac:

I I O.H 0.0 I I I I H.H OO0.00
0.0H H.NH 0.0 0.0H I 0.0 . I 0.0N N.O OO0.0N
N.ON O.NO O.HO 0.00 0.00 H.NO 0.0N 0.00 O.NH OO0.0N
0.0H 0.00 O.HH 0.0H N.HH N.OO H.HN 0.0H O.NO OO0.0H

I I I I I 0.0 I 0.0H N.N OO0.0H O

mmchamm

O O O O O O O O O O O Hmscqa

oumuo>¢
OIH HIH OIH NIH HIH O\x\4 «Om wzm wax: cm: H macaw .
OH OO HN . I I OH NH ON N OH ON I:
MHO>0A HmGOMHMchmmHO mmmu< Hmcowuocflm
OOO. I m uOO.OO I N: OOH. I m NNO.OH I.Nx OOO. I m uHH.OH I N: "maaaam Haw

I I H.N 0.00 O.NH 0.0H N.O I O.OH H.N H.HN N.N O.N mac:

I I H.N I I O.H I I I H.N 0.0 H.H O.N OO0.00

I 0.0H O.OH I O.ON N.OH 0.0 0.0 O.NH H.HN O.NH N.O O.OH OO0.0N
O.NH O.NO 0.00 0.0H O.HH O.OH O.NO O.HO O.HO O.ON H.HN O.NH 0.0H OOO.ON
0.0N 0.00 H.HH I I N.OH 0.0H H.NH O.HO 0.0N 0.0N O.NO N.OO OO0.0H
N.OH I I I O.HH O.H O.O 0.0 0.0 H.N N.OH N.N 0.0 OO0.0H O

mmchHmm

O O O O O O O O O O O O O Haaaaa

omnum>4
OI: HIH OIH NI: HIH O\m\¢ «Om wzm wax: wm: N maw H maw Hmaca
HN OO NN O N NN OH OO OH HH ON ON HOH Iz

 

 

uHo>oq HOGOHumuHsmmao

QMOH4 HMSOHfiOGflh

undone Hana:

 

.wHo>mH HmsoHumNHsmmxo .mmonm

HmsoHuossm .mmaoam an .wusopaommmu mo mmchummII.mN mamda

107

none could be construed as having a major ownership. A
positive answer to this question would indicate that the
respondent would normally not be subject to economic

sanctions as a possible influence on his decisions in

 

cases where ethics were a strong factor, although he

might suffer economic consequences which might result

 

from his free choice of a given alternative. Such a
respondent might be expected to be more independent in his
decision-making and in the policies by which he operates
his business. This variable will be considered in later
analyses.

Years Employed with Company: There are no significant
differences among groups, areas, or levels. By and large,
the entire sample population exhibits a fair degree of sta-
bility in employment, which was one of the questions behind
the question itself. No table is provided.

Iears in Present Position: Almost 36 per cent of
Group 2 respondents have held their present positions more
than eight years, as compared with 9.6 per cent in Group 1,
and for Group 2 this might include most of the owner/man-
agers. Differences among areas and levels were not statis-
tically significant. No table is provided.

Perceived Inter-personal Relationships: Reported rela-
tionships were predominantly Very Good, about 50 per cent,
or Good, about 40 per cent. The balance reported Fair, or

No Subordinates. None reported Poor. Manufacturing and

 

Marketing I
Good and Cr"
Very Good.
Perceive
and 31 were I
sequence of
averaged to:
PCI‘ted NO 5;
interest are
Groups, pesiI
EthiCal att;
of the Supe:
FOr the LEVJ
are higher J
the lower lfll
nixed fOr t"
totals fOr

Engineers

 

108

Marketing respondents reported a lower percentage of Very
Good and Group 2 respondents showed a higher percentage of
very Good. No table is provided.

Perceived Attitudes Toward Ethical Problems: Tables 30
and 31 were so constructed as to provide visibility in
sequence of the four segments of this question, and for
averaged totals for each component. Some respondents re-
ported No Superior and some No Peers or Subordinates. Of
interest are evidences of trends. In the cases of the
Groups, Positive has the highest percentage for perceived
ethical attitude of the Company, a lower percentage for that
of the Superiors, lower still for Peers and Subordinates.
For the Levels, it can be seen that percentages for Positive
are higher in the higher levels, and progressively lower in
the lower levels for Company and Superiors, and somewhat
mixed for the rest. This is also true of the averaged
totals for Levels 3, 4, and 5. In the Functional areas, the
Engineers seem to perceive less positive and more indifferent
attitudes throughout. It is apparent, in examining these
data, that statistical significance as such cannot be the
sole determinant of their value to this study. Patterns and
trends are, in themselves, clues which may indicate characé
teristics of significance for the purpose of the study. In

fact, Siegel4 indicates that arbitrary levels of significance

 

4Sidney Siegel, Non-Parametric Statistics for the
Behavioral Sciences (New York: McGraw-HiII, I956), p. 9.

 

 

.1CJ9

TABLE 30.--Perceived attitudes toward ethical problems, by groups, functional areas, organi-
zational levels, for (N=101).

 

Major Groups Functional Areas Organizational Levels

 

N2 101 73 28 14 16 33 16 22 7 s 27 38 24
Total Grp 1 Grp 2 MFG MKTG ENG 98A A/F/S L-l L-2 L-3 L-4 L-S

 

 

Perceived
Attitudes Toward 8 8 8 3 8 8 8 8 8 8 8 8 8
Ethical Problems

 

Of Company
Positive 68.3 63.0 82.1 64.3 87.5 54.5 81.3 68.2 100.0 80.0 77.8 65.8 50.0
Uncertain 22.8 27.4 10.7 21.4 - 36.4 18.8 22.7 - 20.0 14.8 21.0 41.2
indifferent 8.9 9.6 7.1 14.3 12.5 9.1 - 9.1 - - 7.4 13.2 8.3
Chi Square: x2 a 3.69; p - .158 x2 = 10.76; p - .216 x2 - 10.79; p - .214

Of Superiors

Positive 56 4 57 s 53.6 42 9 75.0 51.5 56.3 59.1 57.1 60.0 66.7 50.0 54.2
Uncertain 33.7 34 2 32.1 50 o 12.5 36.4 37.5 31.8 14.3 20.0 33.3 39.5 33.3
Indifferent 6.9 8.2 3.6 - 6.3 12.1 - 9.1 - - - 10.5 12.5
No Superiors 3 0 - 10.7 7 1 6 2 - 6.2 - 28.6 20.0 - - -
Chi Square: x2 a 8.54; p = .036 x2 = 12.14; p . .435 x2 - 29.71; p = .003
Of Peers
Positive 50.5 54.8 39 3 50.0 50.0 42.4 75.0 45.5 42.9 60.0 63.0 39.5 54.2
Uncertain 38.6 32.9 53 6 35.7 43.8 42.4 12.5 50.0 28.6 40.0 37.0 44.7 33.3
indifferent 7.9 11.0 - 7.1 6.2 12.2 6.3 4.5 - — - 13.2 12.5
No Peers 3.0 1.4 7 1 7.1 - 3.0 6.2 - 28.6 - - 2.6 -
Chi Square: x2 = 8.55; p = .036 x2 = 9.97; p - .618 x2 = 24.89; p - .015

Of Subordinates

Positive 44.6 46.6 39.3 42.9 43.8 30.3 62.5 54.5 57.1 60.0 51.9 39.5 37.5
Uncertain 41.6 35.6 57.1 50.0 50.0 36.4 31.2 45.5 28.6 40.0 48.1 42.1 37.5
Indifferent 6.9 9.6 - - - 18.2 6.3 - - - - 10.5 12.5
No Subordi-
nates 6.9 8.2 3.6 7.1 6.2 15.1 - - 14.3 - - 7.9 12.5
Chi Square: x2 - 5.81; p - .121 x2 - 19.89; p - .069 x2 - 10.37; p - .584
Avera ed Totals
Positive 55.0 55.5 53.6 50.0 64.1 44.7 68.8 56.8 64.3 65.0 64.9 48.7 49.0
Uncertain 34.1 32.5 38.4 39.3 26.6 37.9 25.0 37.5 17.9 30.0 33.3 36.8 36.4
Indifferent 7.7 9.6 2.7 5.4 6.2 12.9 3.1 5.7 - - 1.8 11.9 11.5
No Super-
iors/

Peer/Sub-
ordinates 3.2 2.4 5.3 5.3 3.1 4.5 3.1 - 17.8 5.0 - 2.6 3.1

 

110

 

 

 

 

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111

 

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112

need not be rigidly adhered to when higher levels may
serve a useful purpose.

Perception of Own Situation in Company: The five seg-
ments of this question are shown, for the groups, functional
areas, and organizational levels, on Tables 32 and 33. In
the first segment it is apparent that all respondents per-
ceive their positions as secure. The second segment con-
cerns the possibility of advancement in the respondents'
companies, and here, the situation is almost the reverse of
that in the first segment, about 28 per cent consider ad-
vancement as uncertain. One reason for this might be that
Group 2 owner/managers are in Levels 1 and 2 and neither
have nor seek advancement opportunities. Fifty seven per
cent of the Manufacturing respondents under Group 1 see
advancement possibilities as uncertain. For the remaining
three segments, there appears to be a uniformity of agree-
ment across the five entities, with one exception; the
Groups differ as to liking their work environment. As to
the averaged totals, the Manufacturing respondents seem less
assured as to total situation, and Marketing more assured
than the average.

Perception of Company Goals: The same procedure is
followed here as in Section 1 for the question dealing with
personal goals. Five tables--Tables 34 through 38--have
been constructed to present the data, one for each of the
entities. On Table 34 there is strong agreement between

the groups on the ranking of the first three items--Profit,

111.3

TABLE 32.--Perceived situation in company, by groups, functional areas, organizational levels,
for (N=101).

 

 

 

 

 

 

Major Groups Functional Areas ' Organizational Levels
N= 101 73 28 14 16 33 16 22 7 S 27 38 24
Total Grp 1 Grp 2 MFG MKTG ENG PEA A/F/S L-l L-2 L-3 L-4 L-S
Perceived
Own Situation 8 8 8 8 8 8 8 8 8 8 8 8 8
In Company

 

Position Secure

Yes 90.0 87 7 96.4 85.7 100.0 93 9 87.5 81.8 100.0 100.0 92.6 81.6 95.8
Uncertain 5.0 6 8 - 7.1 ~ 3 0 6.3 9.1 - - 3.7 7.9 4.2
No 5.0 5 5 3.6 7.2 - 3 1 6.2 9.1 - - 3.7 10.5 -

Chi Square: x2 - 2.24; p . .327 x2 - .442; p - .818 x2 - 6.17; p = .628

Advancement

Possible

Yes 57.4 61.6 46.4 28.6 68.8 63.6 62.5 54.5 28.6 40.0 66.7 57.9 58.3

Uncertain 27.7 32.9 14.3 57.1 18.7 33.3 12.5 18.2 14.3 - 33.3 28.9 29.2

No 14.9 5.5 39.3 14.3 12.5 3.1 25.0 27.3 57.1 60.0 - 13.2 12.5
Chi Square x2 a 19.29; p - .000 x2 . 21.24; p - .047 x2 - 33.01; p a .001
Salary Equi-

table

Yes 72.3 69.9 78.6 64.3 87.5 75.8 56.3 72.7 85.7 100 0 77.8 65.8 66.7

Uncertain 16.8 19.2 10.7 28.6 6.3 12.1 25.0 18.2 - - 14.8 18.4 25.0

No 10.9 10.9 10.7 7.1 '6.2 12.1 18.7 9.1 14.3 - 7.4 15.8 8.3

Chi Square: x2 . 1.08; p = .584 x2 . 6.08; p - .638 x2 a 6.14; p a .632

Like Your Work
Yes 87.1 84.9 92.8 92 9 93.8 81.8 81.3 90.9 100.0 100.0 77.8 89 5 87.5
Uncertain 6.9 8.2 3.6 7.1 ~ 9.1 6.2 9.1 - - 14.8 7.9 -
No 6.0 6.9 3.6 - 6.2 9.1 12.5 - - - 7.4 2 6 12.5

Chi Square: x2 = 1.14; p - .565 x2 - 5.68; p - .683 x2 - 8.74; p a .365

Like Environ-

ment
Yes 63.4 56.2 82.1 71.4 75.0 51.5 68.8 63.6 85.7 80.0 55.6 63.2 62.5
Uncertain 21.8 24.6 14.3 21.4 25.0 30.3 6.2 18.2 14.3 20.0 25.9 15.8 29.2
No 14.8 19.2 3.6 7.2 - 18.2 25.0 18.2 - - 18.5 21.0 8.3

Chi Square x2 . 6.47; p - .039 x2 - 8.83; p - .357 x2 - 6.36; p - .607

Averaged Totals .
Yes 74.0 72.1 79.3 68.6 85.0 73.3 71.3 72.7 80.0 84.0 74.1 71.6 74.2
Uncertain 15.7 18.3 8.6 24.3 10.0 17.6 11.2 14.6 5.7 4.0 18.5 15.8 17.5

No 10.3 9.6 12.1 7.1 5.0 9.1 17.5 12,7 14.3 12.0 7.4 12.6 8.3

 

114

 

 

 

 

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TABLE 34.-Perceived company goals, by major groups

116

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117

Product, and Growth. The next four—-Please Customer, Ex-
pand Market, Provide Employment, and Better Community--are
ranked somewhere between fourth and seventh by both groups,
and they agree on the ranking of the last two--Financial
Stability and Other. Of interest is the fact that Group 2
ranks Employment and Customer ahead of Market and Community,
in contrast to the converse for Group 1.

On Table 35 for Functional areas, almost the same
pattern prevails as for the Groups. Profit, Product, and
Growth are the three highest in rank for all but Marketing,
which placed Market Expansion ahead of Product--a form of
"functional bias."

Table 36 for Organizational levels reflects Group
2's greater concern for employee and customer, as can be
seen in the rank ordering of Levels 1 and 2. Levels 3, 4,
and 5 are in closer agreement.

Tables 37 and 38 for functional areas and organi-
zational levels under Group 1 show some diversity in rank-
ing, but Profit is always first, throughout, Growth is
second or third, and the rest scatter somewhat. Engineer-
ing and Accounting/Finance/Systems on both Tables 35 and 37
have the largest percentages of No response, and this is
also true of Level 4 on Tables 36 and 38. These findings
indicate that most respondents agree on the relative im-
jportance of primary business goals--Profit, Growth, and

IProduct, but have a diversity of opinions as to the rest,

 

TABLE 35.-Perceived company goals, by functional areas (N=101).

118

 

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TABLE 36.-Perceived company goals, by organizational levels, for (N=101).

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Chi Square

 

TABLE 37.-Perceived company goals, by functional areas, for (N=73) group 1 only.

120

 

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121

 

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notably that Group 2 places employees and customers right
behind the primary three goals.

Perceived Status of Businessmen's Ethics: This is the
last of the Environmental Factors. On Table 39, Groups 1
and 2 differ. It is apparent that Group 1 has a more
favorable and Group 2 a less favorable view of the trend
in business ethics. There is sharp contrast with respect
to the three "opinions" in the functional areas for Group 1,
with Manufacturing and Engineering at one end, Accounting/
Finance/Systems at a mid-point, and Marketing and Personal
& Administration at the other end. The organizational
levels are much more uniform. Therefore it would appear
that there is some relationship between functional orien-
tation and opinion and this might have to do with the ex-
tent of exposure to ethical problems. Later analysis will

consider this possibility.

Summary of Section 3

 

The groups, functional areas, and organizational
levels are differentiated to some degree by most of the
thirteen sets of environmental variables, but few are sig-
nificant. Group 2 respondents appear to have greater sta-
bility and security in terms of income, ownership of the
firm, years in the firm, and as to perceiving their own
situation in the firm, than do Group 1 respondents.

Group 1 appears to have greater technical competence in

terms of the diversity of special functions. Both agree

123

 

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124

as to primary business goals, but Group 2 reflects more
concern with the welfare of employees and customers than
Group 1. The functional areas exhibit some functional
bias in their perception of company goals. No respondents
reported poor interpersonal relationships, but Marketing
and Engineering were less positive than the other areas.
Marketing also perceived their situation in the company

as being more favorable than did Manufacturing. Marketing
and P & A had a more positive opinion of businessmen's
ethics, and Group 2 a less favorable opinion. Engineering
perceived the firms attitude toward ethical problems as
being less favorable, and this was evident in Group 1
levels in the form of a trend negatively downward. These
variables will be referred to in discussing the findings

on the case problems and the tests of hypotheses.

CHAPTER IV

FINDINGS: CASE PROBLEMS AND

RELATED INFLUENCES

Introduction

 

The previous chapter provided a view of the
respondents in terms of their personal characteristics,
their perception of the relative significance of various
external and internalized influences in a decision-making
situation, and their work environment. In this chapter
their behavior is examined with respect to deciding upon a
pattern of action choices to be taken to resolve four case
problems, and also their reaction to two additional situa-
tions involving questions of ethics. As before, the analy-
ses will deal with the two major groups and total population,
then with the components comprising the functional areas and
organizational levels with which the respondents have been
identified. An additional analysis differentiates the
respondents according to two groups in three of the first
four problem situations. One half of the respondents viewed
the problems "objectively," being asked to indicate how, in
their opinion, the case subject would behave; the other
half were requested to place themselves in the case role

and respond "subjectively" to the problem situation.

125

126

The respondents were requested to read through the
brief cases, and then to circle the one or more of seven
suggested actions they deemed the most appropriate. An
eighth "open-end" option was provided, in which the
respondent could briefly propose another action in
addition to, or even in place of, those formulated.

Each of the case problems is set forth on a sep-
arate Exhibit which precedes the initial analysis and dis-
cussion. Next, the tabulated responses are reviewed.
These are expressed as "action choice patterns," which
are explained farther along. Following these initial
reviews, the cases are examined in terms of "solution
ratings" which have been applied to each of the action
choice patterns to determine how completely they appear to
solve the problems. Next, an evaluation is made of the
ethical content and quality of these action choice patterns
in terms of the proportion of "prudence" and "justice" they
reflect. Together, these provide a more meaningful basis
for comparing the ethical perceptions of the groups,
functional areas, and organizational levels.

The criteria for the ratings are explained and dis-
cussed in light of the citations of the several authorities
set forth in Chapter I from which they are derived, and
they are presented in a figure in schematic form. The
rating scales and action choice patterns for all six prob-

lem situations are combined on another figure. The

127

procedure for determining the ethical content and quality
is also shown on one figure. These follow in the next
sections immediately after the close of this discussion.

In addition to circling the action choices, the
respondents were asked to indicate which three of the
"influences" they had rated in Part II of the questionnaire
entered most strongly into their decisions with respect to
the case problems. These have been tabulated, and they are
reviewed and discussed following the case problem analyses.

Since this is an exploratory study it is, in a
sense, a test of the feasibility of making logical analyses
of the ethical content of the problem situations and of a
rational means of comparing the decision choices of various
organizational components (and individuals) in the indus-
trial context with respect to the same or similar situa-
tions. Such shortcomings as may become evident are given
due recognition. Value judgments and opinions are avoided
as much as possible, but the area of inquiry is a highly
subjective one, while truths--realities--must be sought
objectively. Yet, as Roubiczek indicates1 both the objec-
tive and subjective methods of inquiry must be utilized for
a more complete understanding of the implications of

ethical problems .

 

1Roubiczek, Values in the Age of Science, pp. 268-74.

128

A number of correlations have also been attempted,
within the limits of the computer program made available
for this study, and these will be discussed in the final

portion of the chapter.

Framework of Ethical Criteria

For the sake of convenience many of the key con-
cepts, words, and phrases which are to be found in that
portion of Chapter I setting forth the citations from the
writings of authorities on ethics have been excerpted and
organized in the form of the schematic in Figure 3. It is
not complete, but is reasonably comprehensive and will be
referred to from time to time instead of reverting to
specific citations--unless that should be the more

desirable procedure in a given circumstance.

The Solution Rating Scale

During the process of considering the statistical
procedures to be used in this study, it was recognized that
while analysis of the responses might indicate whether the
various components of the functional areas and organiza-
tional levels differed in their selection of action choices
for the first four case problems it would be helpful to find
some appropriate means of objectively evaluating them for
ethical content. It appeared that a valuation scale uni-
formly applied to the responses could be workable. Apply-

ing some sort of value to each individual action choice was

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130

impractical, because it becameobvious that as these were
combined the effect changed, and also that most of the in-
dividual actions viewed separately were inadequate and not
complete as a possible solution of the total problem to
which they related. In addition, the open-end responses
were unknowns. As became obvious, the number of unique
patterns of responses were too diversified to be manageable
for analysis, and it became necessary to group them in some
logical fashion, which was done after the data had been
gathered and the response patterns became evident. There
was little point in attempting to anticipate all the possi-
bilities which might reasonably occur. The question might
be asked as to why some such limitation was not imposed
directly on the respondents in the first place. In answer--
one of the key points in the research approach was that the
respondent should have as much freedom to choose among al-
ternatives as possible, but that a completely open, essay-
type answer was impractical. The seven action choices
suggested for each case problem inevitably came out of this
researcher's background and experience, and his direct
knowledge of the real-life counterparts of the problems
formulated as hypothetical cases for the purpose of the
present research study. It can be seen that each of the
four cases represents a situation which requires resolution,
and that the situation as presented has ethical and/or moral

implications of one kind or another, both in how the case

131

came about in the first place, and in the potential solu-
tions indicated by the suggested action choices, which
deliberately provided for a degree of ambiguity, and the
possible Open-end eighth choice.

To repeat a portion of an earlier citation, that of
Roubiczek, "The subject matter of ethics is traditionally
circumscribed by the following three questions: 1. What
ought we to do? 2. What is the meaning of 'good?‘ 3. Are
we able to do what we ought to do?"2 It seems obvious that
within the limits of the seven action choices and an eighth
option an attempt is made to deal with at least the first
and third of the above three questions, and that the second
is at least implied by the extent to which the action choice
patterns serve to most completely provide a solution to the
problem in question. Thus, the essential determination here
involved is how to "rate" the various patterns among the
nine admitted for each case, in order to measure the rela-
tive perceptions of the groups, functional areas, and orga-
nizational levels into which the respondents have been
stratified, in terms of how adequately or completely their
response patterns serve to resolve the given problem.
Therefore, the rationale for applying the simple five-point
Scale is to see what has been left undone of what ought to
be and gag be done within the limits of the means provided

fur the seven choices plus an option of the decision-maker's

‘

2Roubiczek, Values in the Age of Science, pp. 5-6.

132

own formulation. In simple terms, the solution rating scale
provides for a "penalty" for "errors of omission"—-low
rating being better than high. Thus, the action patterns
are rated in terms of how completely they appear to pro-
vide a solution for the problem in question. The actual
scale developed and applied to the action patterns for all
the cases appears in a consolidated figure in a later

section just before the rating process begins.

Evaluation of Ethical Content
and Quality

 

A further question was raised, "Does the rating
applied also fairly represent the ethical content of the
solution?" In other words, are the most complete solutions
the most ethical? To determine this, yet another analysis
was made using the basis ethical criteria of C. I. Lewis,
who was cited in Chapter I, and which is included in
Figure 3, Framework of Ethical Criteria. He holds that the
ethical content of an action should be considered in terms
of how it serves to satisfy the prudential concern of the
doer, provide justice for those affected by the doer's
action, and also be technically right.3 In the industrial
context, actions involve individuals and groups both inter-
nally and externally to the firm. Thus, seven considerations
come into view. Internally there are, (l) the prudential

concern of the individual for his own interests, (2) justice

 

3Lewis, Ground and Nature of the Right, p. 80.

133

to the company resulting from the individual's actions,
(3) justice to other persons within the firm resulting from
the individual's actions. Externally, there are, (4) pru-
dential concern by the company's representatives for its
interests, (5) justice to other persons outside the firm
resulting from actions of the firm's representatives, (6)
justice to other companies resulting from actions of the
firm's representatives. Finally, there is, (7) the tech-
nical rightness of the actions in achieving the common
purposes of those concerned. For convenience, the seven
considerations were designated: Internal--P/S, J/C, J/OP;
External--P/C, J/OP, J/OC; and T/R.

The respondents had been given case problems worded
both objectively and subjectively, therefore, each mode was
separately analyzed, individual by individual, and each
action choice within each pattern was identified with the
one of the above considerations to which it most closely
related. The results were compiled by simple count and
converted to percentages representing the relative propor-
tions of "prudence" and "justice" contained in the action
choice patterns. The (T/R) technical rightness count was

eXCHluded as being neutral. Thus, the total of P/S and P/C
represented Prudence, while the total of J/C, two J/OP's,
and J/OC represented Justice. Both together became pro-
portions of 100 per cent. The difference between the two

percentages became a "bias factor." If the difference is

134

zero, Prudence and Justice are considered to have been
equally satisfied. If, for example, Prudence is 46 per
cent and Justice 54 per cent, the bias factor is 8 per cent
in the direction of Justice. The scheme is, of course,
arbitrary, and the individual action choices are not
weighted. However, the criteria are uniformly and impar-
tially applied and make it possible to draw reasonable com-
parisons between groups and areas (the levels were excluded)
as to the ethical content and quality of their action
choices in the aggregate. The procedure is depicted in a
figure in a later section immediately preceding the evalu-
ation of the case problems. This evaluation also becomes
the test for Hypothesis 4.
The process of analysis of the case problems now

begins, and in the following sequence.

1. Preliminary analysis of all cases for explanation
of content and development of the action choice patterns.

2. Rating of all cases using the (S/R) solution rating
scale, also comparing results of objective and subjective
modes, and in total by groups, areas, and levels.

3. Evaluation of four cases for ethical content and

quaility in terms of Prudence and Justice.

Case Problem 1, Preliminary Analysis
Exhibit 1 presents Case 1 as it appeared in the
questionnaire. As can be seen, the respondents were to
'take an objective view of the situation, there being no

specific role for them to consider. The question at

135

Case 1

Out of town firm supplies your company with new
component, unit value $5 each. The B/P, Specs and P.O.
show critical dimension of 1.0010. First delivery of 200
units is invoiced at $1,000. Q.C. finds 50 units under-
size by up to .0005 and not repairable, sets them aside
for return, and notifies the Buyer. He phones supplier
who promises prompt replacement and requests the rejects
be scrapped here to save cost of return. Immediately
afterward (1) Production finds that such a close tolerance
(I.0010) is not really needed, (2) Engineering agrees that
the tolerance could be t.0015.

Which (one or more) of the following actions do
you recommend:

1. Debit supplier $250 for the rejects;

2. Scrap the rejected parts;

3. Advise supplier the rejects have been accepted;

4. Do nothing;

5. Request Engineering issue B/P and Spec
revisions;

6. Request Purchasing send supplier new B/P,
Specs, and P.O. revision;

7. Request Q.C. to accept the rejected parts for
use in production;

8. Any other (briefly)

 

Which three of the "Influences" you ranked in
Part II entered most strongly into your decision?
Strongest, # Next, # Third Strongest, #

Exhibit l.--Case Problem 1, Objective Mode Only.

136

issue, and the primary ethical problem, is whether the
supplier should be compensated for parts which, after
rejection for failure to meet specified tolerances, were

found to be useful, but only because it was agreed, inter-

 

nally, that the critical tolerance could be opened up to
the extent that all 50 initially rejected parts could be 1.
used. The seven action choices can all be justified,
each alone or in some logical combination, on some
rational basis. For example, Choice 4--Do nothing, can _J1
be justified on the basis that a safety margin is desired
and that tighter tolerances should assure higher quality
and less possibility of early failure due to more rapid
wear. This, of course, requires some assumptions as to
the kind of application and company policies, neither of
which are stated. By contrast, it could be stated that
whatever the application, it should be adequately served,
since both Production and Engineering agree on the accepta-
bility of more open tolerances for the given dimension.
This should result in greater efficiency and lower costs
in the inspection process at least. Some of the respon-
dents recognized the possibility of greater cost saving
by' suggesting that a lower price be negotiated in exchange
fior the more open tolerance offered. Choices 1 and 2
could logically be selected as following through on the
.agreed.upon terms of the purchase order if the safety

Inargin is desired, and this would be a more appropriate

137

answer than Choice 4, alone. A completely different kind

of solution might be to select Choices 1 and 7, in combi-
nation, on the basis that the purchase order terms are
satisfied, and there is no purely legal bar to salvage and
uSe the parts, since the supplier delegated responsibility
for disposing of the parts to the buyer. The question of
Ethics turns on the question of equitable consideration
of the interests of all claimants--in both the short and
long range, recognizing that "First delivery" implies an
on-going relationship with the supplier. The above are
here squested as examples of the range of possibilities.
No respondent raised the question of why the supplier
Shipped such a high proportion of rejectable parts in the
firSt place, and especially on a first shipment when
close inspection is to be expected. It is also pointed
out that this case involves a group-to4-group relationship,
and that no individual's interests are involved.

In this initial examination, no evaluations are
made 0 only comparisons between the frequency of selection
of va-rious "patterns" of action choices by the groups,
functional areas, and organizational levels. It is pointed
out, however, that the next series of Tables show a range
Of only nine such patterns, the original, much wider, range
having been reclassified into a more manageable range,

Statistically. The original selections are shown on a

set Of three tables in the Appendices, in terms of the

138

Original raw data. The introductory explanations for the
balance of the cases will be more brief. Comments and
analyses of the related Influences cited by the respon-
dents are reserved for a later section.

Table 40 presents the consolidated action choice
Patterns for Case 1 for all entities in terms of per-
centages. The chi square significance levels for all
five entities are higher than the "standard" .05, and
from the standpoint of frequency distribution only it
would appear that the null hypotheses should be accepted
and that in terms of this variable, the characteristics
of all components and entities are such that they identify
with the same or equivalent populations. However, the
relatively low p's for the major groups and functional
areas under (N=101) are noted. In addition, after appli-
cation of a rating scale later on, the cases will be
re‘eXamined. On Table 40 itself, the most noticable
deviations from the general pattern of selections are
those of Marketing and of Levels 1 and 2. These will be

highlighted when the rating scales are applied.

Case Problem 2, Preliminary Analysis

 

As can be seen on Exhibit 2, this case problem
Was Presented to the respondents in both the objective
and Subjective modes. This is a rather typical case of
mar“factual reporting, and involves individuals. Whereas

Case 1 had elicited only 15 original "patterns". and 13

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140

Case 2

Profit Center D is currently working on four programs. The current
month-end Performance Report submitted for Profit Center Manager's review
Shows the following:

 

 

 

 

 

 

 

 

(5000's) Planned Cost Budget F'cast To Est. Cost Projected
Cost to Date Balance Complete at Completion Variance
Program 1 s 180 s 150 $ 30 s 37 $ 187 $ ( 7)
2 110 90 20 23 113 ( 3)
3 250 160 90 115 275 *(25)
4 260 130 130 110 240 20
Total S 800 $ 530 $ 270 $ 285 $ 815 $ (15)

‘Original estimate $10,000 too low; costs to date held very close; all
foremen agree forecast is as tight as possible; projected cost overrun
appears inevitable.

(Obj ect ive Mode)

Consider an average Financial Analyst reporting to the Profit Center
Manager. His staff compiles the data and prepares the report, which the
P.C. Insanager reviews, signs, and submits to the General Manager. The P.C.
Manager does not want to submit such a bad report for Program 3. He states
the (iat:a may be inaccurate and suggests that a "temporary adjustment" of
$15,000 in forecasts between Programs 3 and 4 “for just this report" would
forestall higher level inquiry and give him time to "try to work things
OUt-" .He is responsible for explaining the variances. The Financial
Analyst reluctantly complies on the basis that the P.C. Manager still has
COHtJKDl. over what has not yet happened. The following month's report
ShOWS that things have not improved, but have gotten worse. The P.C. Man-
23:: fumes and again suggests that the Financial Analyst "adjust the fore-

Which (one or more) of the following actions, in your opinion, would
the average Financial Analyst take?

(“Subj active Mode)

Yo 123 are Financial Analyst reporting to the Profit Center Manager.
res; Staff compiles the data and prepares the report, which the P.C. Manager
not-laws, signs, and submits to the General Manager. The P.C. Manager does
he .Want to submit such a bad report for Program 3. He states the data may
fOrlnaccurate and suggests that a "temporary adjustment" of $15,000 in
hi ec=asts between Programs 3 and 4 "for just this report" would forestall
reg er level inquiry and give him time to "try to work things out." He is
basPQnsible for explaining the variances. You reluctantly comply, on the
Thelds that the P.C. Manager still has control over what has not yet happened.
gottfkbllowing month's report shows that things have not improved, but have
E311 worse. The P.C. Manager fumes and again suggests that you ”adjust

 

the orecast."
Which (one or more) of the following actions would you take?
1. Again comply;
2. Refuse to comply;
3. Delay action;
4. Discuss the problem with the foremen;
5. Privately call the company Controller;
6. Ask Personnel for a transfer;
7. Resign;
8. Other (briefly)
Strc> Which three of the "Influences" you ranked in Part II entered most
Strongly into your deCision? Strongest, # Next, 4 Third

l”\gest, #

Exhibit 2.--Case Problem 2, Objective and Subjective Modes.

141

Choice 8 written-in responses, this case brought out 31
Original patterns of action choices and 38 Choice 8
additional proposals and comments from among the 101
respondents. This is indicative of much deeper involve-
"!ent on the part of the respondents. Among the questions
raiseud are divided loyalty, cooperation in misrepresen-
tatiora, violation of standards of professional competence
and "ggenerally accepted accounting principles," and
others , not to overlook risk of being fired. The Harvard

Business Review presentation of the "Crisis in Conscience

 

at Quasar" case, mentioned in an earlier citation dis-
cussed in considerable depth the problems involved in
this kind of situation, and the rather remarkable division
0f Opinion among executive readers, nationally, as to the
acceptability of this kind of behavior on the part of
responsible managers. Among the seven suggested action
choices, three are basic--comply, refuse, or delay, as
indicated by the parenthetical groupings opposite the
"Pattern" numbers on Table 41. Here, at the Group level

there is strong agreement, and also among the Levels,

except for Level 2 (for WhiCh N=5 only). For these, p
well over .05, and H0 is accepted. However, for the
functional areas under both (N=101) and (N=73) the P'3 =

Well below .05, and Ho is rejected. As can be seen there

\

9 4Fendrock, Harvard Business Review, March-April,
1 68' pp. 112 ff.; Sept.-October, 1968, pp. 14 ff.

142

 

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143

is a wide divergence among all five components as to the
actions on which their pattern selections concentrate,
particularly Marketing, Engineering, and Accounting/
Finance/Systems. These differences are emphasized when
the (ethical rating scale is applied, in a later section,
and aalso bring into view the difference in "solution per-
cepti on" as between objective and subjective respondents,
whicfli is used to test Hypothesis 1 (the manager views him-

self as more ethical than the other managers).

Case Problem 3, Preliminary Analysis

This is also in both the objective and subjective
modes. As Exhibit 3 shows, this is also a not uncommon
case (of apparent injustice to a deserving employee due to
rigfixiity and impersonality of budgetary constraints.
This problem can be considered in the light of Gouldner's
coninept of reciprocity and expectations.5 For this case
Prohlem there were 31 initial patterns which were con-
solidated to 9, and 24 respondents had additional action
ch01 ces or suggestions. According to Table 42 the
res£>c>nse frequencies indicated no statistically significant
differences for all five entities, all p's are well above
'Os’o and Ho is accepted. Nevertheless, there are

noti ceable differences in response patterns in the

\

5Paul R. Lawrence, et al., Organizational Behavior

Whinistration (Homewood, 111.: Richard D. Irwin, Inc.,

1) . pp. 556-57.

144

Case 3

(Qéipctive Mode)

. Consider an average Senior Buyer. One of his
Junior buyers rates an overdue salary increase but things
are tight and there is no allowance for this in the depart-
mental budget for at least 6 months. The Junior has unex-
pected financial problems, is discouraged, unhappy, and
talks of leaving. Neither Personnel nor the Senior's
Superzior has any suggestions. The Senior Buyer has reason
to believe a new supplier the Junior handles may be "getting

too firiendly" with him, knowing his circumstances.
Which (one or more) of the following actions, in
your'<:pinion, would the average Senior Buyer take?

(Subj e ctive Mode)

Ygg are the Senior Buyer. One of your junior
bPYers rates an overdue salary increase but things are
tight: and there is no allowance for this in the depart-
mental budget for at least 6 months. The Junior has unex—
Pected financial problems, is discouraged, unhappy, and
talks of leaving. Neither Personnel nor your superior has
any singgestions. You have reason to believe a new supplier
the Crunior handles may be "getting too friendly" with him,
kmDWing his circumstances.

Which (one or more) of the following actions would
you take?

1. Do nothing;

2. Tell the Junior Buyer the budget situation and
promise action in 6 months;

3. Wait to see what happens;

. Warn the Junior not to get involved with the

Supplier;

5. Talk to the Supplier;

6. Offer to loan the Junior money;

7. Insist your superior request a budget adjust-
ment;

8. Other (briefly)

 

Pa Which three of the "Influences" you ranked in
Stlpt; II entered most strongly into your decision?
tongest, # Next, # Third Strongest, #

. Exhibit 3.--Case Problem 3, Objective and Sub-
3e°tive Modes.

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146

functional areas for Manufacturing and Personnel and Admin-
istration which use of the rating scale brings into better
view later on, at which time, also, the subjective vs
objective analysis is under examination. This case con-
trasts with the previous two in that it equates the
interests of individual against group and the superior-
subordinate relationship, and considers the extent to
which the manager may be willing to press higher levels

on behalf of his subordinate.

Case Problem 4, Preliminary Analysis

 

This case, set forth on Exhibit 4, involves con-
flict between peers, and also self-interest vs company
interests. It also questions the consideration due
another organization whose employee has been induced to
partially relax the restrictions of scheduled releases.
Economic consequences are also a part of the problem.
There were 33 original action choice patterns before
consolidation to 9, but only 8 written-in options. About
90 per cent of the respondents opt for a show-down with
the erring Sales Manager, some resting almost entirely
on this issue. Others give varying degrees of consider-
ation to the other aspects, which will be elaborated upon
during the course of applying the rating scale later on.
As regards statistical level of significance, all p's are
well over .05, as Table 43 shows, but Marketing and

Personnel and Administration differ noticeably from the

147

Case 4

(ijective Mode)

 

Consider an average Manufacturing Manager. The Sales Manager (who
seems likely to be the next General Manager) has befriended one of the buyers
of a major account to which 3 types of special fabricated components are
sold under blanket P.O.'s with monthly but somewhat flexible delivery
schedules. (The Sales Manager has sent flowers to the buyer's sick wife,
bought toys for his children, etc.) Production is programmed for early
delivery of each month's schedule plus holding a 50% reserve against next
month. Volume has been dropping. This month the Sales Manager requests the
50% reserve be increased to 100% and the 3 components shipped 4 weeks, 3
weeks, and 2 weeks early, stating a revised release is coming. Instead,
the customer's buyer calls the Production Control Office to complain about
the first early shipment. He is told that the Sales Manager made the
arrangement. The buyer subsides, saying he only agreed to a 50% advance
on one item to "relieve your inventory problem." A week later he frantically
calls again, requesting that shipments be stopped.

Which (one or more) of the following actions, in your opinion, would
the average Manufacturing Manager take?

(Subjective Mode)

 

Yep are the Manufacturing Manager. The Sales Manager (who seems
likely to be the next General Manager) has befriended one of the buyers of
a major account to which 3 types of special fabricated components are sold
under blanket P.O.'s with monthly but somewhat flexible delivery schedules.
(The Sales Manager has sent flowers to the buyer's sick wife, bought toys
for his children, etc.) Production is programmed for early delivery of
each month's schedule plus holding a 50% reserve against next month.

Vblume has been dropping. This month the Sales Manager requests the 50%
reserve be increased to 100% and the 3 components shipped 4 weeks, 3 weeks,
and 2 weeks early, stating a revised release is coming. Instead, the
buyer calls your Production Control office to complain about the first
early shipment. He is told that the Sales Manager made the arrangement.
The buyer subsides, saying he only agreed to a 50% advance on one item to
"relieve your inventory problem." A week later he frantically calls again,
requesting that shipments be stopped.

Which (one or more) of the following actions would you take?

1. Ignore the buyer;

2. Confront the Sales Manager for an explanation;

3. Revert to authorized scheduled releases;

4. Request that the Sales Manager obtain the revised releases;
5. Take the matter up with the General Manager;

6. Request that billing be delayed on the advance shipments;
7. Authorize return of the advance shipments;

8. Other (briefly)

 

Which three of the ”Influences" you ranked in Part II entered most
strongly into your decision? Strongest, # Next, 4 Third Strongest,

 

Exhibit 4.--Case Problem 4, Objective and Subjective Modes.

1J48

 

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149

other functional areas in their selection of action choices.
H0 is necessarily accepted. The objective vs subjective

analysis is also considered in the later section.

Case Problem 5, Preliminary Analysis

 

This case and Case 6 differ from the preceding
four in that an expression of opinion rather than a
selection of action choices was requested. The respondent
is requested to indicate the statements which best express
his opinion as to whether the requirement for a stipulated
political contribution imposed on the new executive is
ethical or unethical. Some respondents chose statements
from both sides of the question. There were four choices
for each side, and no open-end options were provided for.
In retrospect, it is felt that this would have been
valuable additional information. As Exhibit 5 shows, the
primary question here is whether the employee is being
coerced, or whether he cooperatively and willingly joins
in efforts to maintain a political climate under which
it appears that a free enterprise system can exist and
hence his own interests best served in the long run.
This is not exactly so stated in the language of the
problems itself, but is implied. The large number of
the respondents who split their selection of appropriate
statements in varying degrees is indicative of their
recognizing good and bad aspects in the situation. It

might have been interesting to find out how many of the

150

Case 5

The Engineering Supervisor had been recently pro-
moted to Project Manager and had achieved accession to the
Executive level, which meant, among other things, that he
shared in the annual executive bonus, was entitled to lease
two cars, etc. A few months later his supervisor handed
him a slip on which was pencilled the amount $65, and the
name of a central office executive. "This," he said, "is
your political contribution for this year. Make out your
check to the party of your choice, put it in an envelope
addressed to Mr. (the central office executive) and give
it to me to forward."

Which of the following (one or more) express your
feelings best?

A. This requirement is not unethical because:

1. Executive levET Eafsafinel should have a sense of
social responsibility and support our democratic
political system.

2. It takes a little pressure to induce one to make
a political contribution.

3. If political parties are not financially supported
our democratic system may fail.

4. The executive has free choice as to which party
he can support.

B. This requirement is unethical because:

5. The executive is_Being required to make a political
contribution whether he wants to or not.

6. The amount of his contribution is being stipulated;
he has no choice as to how much.

7. The Company uses this device to evade the Federal
laws prohibiting political contributions by
business corporations.

8. The executive can be "rated" by higher management
according to which party they can see he supports.

Which three of the "Influences you ranked in

Part II entered most strongly into your opinion?
Strongest, # Next, # Third Strongest, #

Exhibit 5.--Case Situation 5.

151

respondents actually faced such a requirement in their

own companies; however, the question was not asked, because
it was felt it might produce a negative attitude toward
the purposes of this study. There is no rating scale
applied to this case and Case 6, of the same sort as for
the prior four cases, rather, a simple percentage is
established based on whether the responses are entirely

or predominantly on one side or the other, or split.

This is demonstrated in the later section. Table 44 shows
that for this case, p = well over .05 for four of the
entities, indicating that the frequency distributions

tend to be well dispersed for all components, and for

these, H is accepted. However, in the case of the two

0
major groups, p = over .05 but is much closer than the

rest, nevertheless H0 is provisionally accepted.

Case Problem 6, Preliminary Analysis

 

The structure, although not the content, of this
case is similar to that of the previous case, in that
four opinions for either side of an ethical question are
presented for the respondent's consideration and selec-
tion. The details are given in Exhibit 6, and this time
the point at issue is in a much broader context, to pro-
vide contrast with the previous case, and to see if the
pattern structures differed in any marked degree. It is
obvious that they did, as a comparison of the Tables

shows, and in addition the significance levels for the

152

 

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N.NN N.NH N.NN o.oN N.NH N.NH N.NH N.NN N.NH N.HN N.NH N.NH N.NH HNININIHV N
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153

Case 6

The government is considered by many to be a
"price buyer," and in the case of many requirements such
as defense, space, atomic development, etc., is the ulti-
mate "only" customer. Thus, the government's bargaining
position is generally deemed to be stronger than that of
any supplier unless the supplier has a proprietary item
(or service) for which there is no acceptable substitute
and is therefore a "sole source."

Consider a situation where there are many suppliers
and the government buys an electro-mechanical assembly
periodically in lots such that the available requirements
are divided among the three lowest bidders under a Fixed
Price arrangement. Because business is generally falling
off more suppliers come in, competition is keener, and
the price keeps dropping as each new periodic bidding
opportunity is opened. In fact, some bidders stay in
only to try to get volume to help absorb fixed overhead.

Which of the following (one or more) express
your feelings best?

A. The government's buying policy is not unethical

because: —_’——-'—_

1. They must buy at the lowest possible price in the
interest of the taxpayer.

2. No supplier (in this case) is forced to partici-
pate by making his capacity available.

3. Suppliers should not expect to make much profit
at the taxpayers' expense.

4. This is the only way businesses can operate in a
free economic system.

B. The government's buying policy is ggethical because:

5. The buyer is unmercifully using whipsawing tactics
to force the price below a profitable level.

6. Suppliers require a reasonable profit to remain
healthy and grow, (an accepted principle in com-
mercial industry).

7. The employees of such suppliers are denied oppor-
tunities for advancement and normal wage increases.

8. The suppliers may be forced into price collusion
practices in order to survive. '

Which three of the "Influences" you ranked in

Part II entered most strongly into your opinion?
Strongest, # Next, # Third Strongest, #

Exhibit 6.--Case Situation 6.

154

five entities also changed considerably. This time, as
Table 45 shows, the major groups are much more alike,
whereas greater differences are evident among the compo-
nents of the functional areas and organizational levels.
The question at issue involves the total competitive
environment within which the companies of the respondents
function when they engage in government contract work.
There is no consideration of, or identification with,
individuals. There is a possibility that the nature of
the responses may reflect the relative stability of the
industry and organizations to which most of the respon-
dents belong. It would be interesting to see what kind
of response to the question might come from managers in
the aerospace/defense industries, but that was not pos-
sible for purposes of the present study.

As described in the previous case analysis, no
scale rating is used for this case, but again a simple
percentage relationship is developed between the responses
grouped on either side of the question. The significance
levels for the frequency distributions in all components
is above .05, but the organizational levels for both
(N=101) and (N=73) seem to indicate a trend from low
to high which may be of interest. This is re-examined

in a later section.

155

 

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156

Rating the Action Choice Patterns
for Each Case

 

In this section each of the case problems will
again be considered in turn, this time to explain the
rationale for the "solution rating" (S/R) which has been
assigned to each of the nine action choice patterns
identified with each case problem. Figure 4 provides a
consolidated view of the S/R scales for the four sets of
action choice patterns and the two "opinion choice"
patterns of Cases 5 and 6. In addition, the number of
frequencies of responses associated with each action
choice (or opinion choice) is shown, both for the indi-
vidual patterns and in total, and also the total of all
frequencies for each pattern. The S/R rating scale is
shown opposite each pattern for Cases 1 through 4, and a
simple "U," "E," or "U/E" designation is identified with
each opinion choice in Cases 5 and 6. In these two
cases the "U" and "E" indicates that the respondents
identified their opinions totally or predominantly with
one side of the question of the other, whereas the "U/E"
indicates a split set, 50/50, of opinions as to the ethical
implications of the given problem situations.

The reader is reminded that the following ratings
refer to the relative degree of completeness of the pro-
posed solutions, as explained early in the chapter, and
that another evaluation will follow which will consider

the proportional content of Prudence and Justice.

157

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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158

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159

Case Problem 1

 

In this group-to-group situation the economic
interests of supplier and customer are the primary concerns,
but individual interests are also involved in terms of the
professional competencies of the managers in each of the
functional areas whose decisions are to be considered.

As the action choices and case narrative indicate, Pro-
duction, Quality Control, Purchasing, Engineering, and
Accounting are all involved to some degree. The recommen-
dations and potential actions of each are brought into
view, and the respondent is requested to select that
course of action (combination of action choices) which

in his judgement will best resolve the total problem.

Referring to Figure 4, Case Problem 1, it will be
seen that none of the respondents selected Actions 2 or
4--"Scrap the rejects," or "Do nothing." This leaves
only six actions to consider and substantially reduces
the problem of rating. None selected the combination of
actions 1 and 7--"debit supplier," but "use the initially
rejected parts"; probably legal, prudential of course,
but questionable as to justice. The least complete
solution is Pattern 4, "notifying the supplier" and
"requesting Q.C. to accept the rejects," since it
ignores the potential improved efficiency and cost
saving through opening up the tolerance via actions 5

and 6. This pattern would be considered both technically

160

and morally deficient, because it is wasteful and would
result in economic injustice to both companies--it is
rated 5. Pattern 3 ignores Engineering's functional
responsibility and authority to officially revise the
tolerances and follow through with notifications to Pro-
duction and Q.C., which could result in a repeat perform-
ance on the next shipment from the supplier. This is

more a technical rather than moral error, and would have
temporary unfavorable economic consequences--it is rated 4.
Pattern 7 is similar to pattern 5 but is modified by
written-in options to keep the tolerance tight and pay

for parts actually used. This is less efficient and more
costly than to follow through with confidence on the
judgement of Engineering and Production that the toler-
ance could be opened up for future shipments. Thus, a
degree of both technical and moral (wastefulness) error

is indicated-—it is rated 4. Pattern 8 fails to follow
through and provide an opportunity to make a more favorable
arrangement with the supplier, to the possible mutual
advantage of both, and is therefore also deemed an incom-
plete resolution--it is rated 4. Pattern 5 overlooks
Q.C.‘s responsibility to approve acceptance of the rejects
in accordance with revised specifications, mainly a tech-
nical error with some possibly small cost consequences
because of delay--this is rated 3. Pattern 2 fails to

give the supplier more timely notification and leaves him

161

working to unnecessarily closer tolerances until the
revised P.C. and specs. reach him, and delays a possible
price renegotiation. This is primarily a technical
deficiency, but could be considered a moral error if
carelessness is the problem--it is rated 3. Pattern 1
covers almost all aspects but fails to consider a pos-
sible price adjustment to benefit the buying company;
justice to the supplier is more than served, but the
solution is prudentially deficient-~this is rated 2.
Pattern 9 is almost identical to pattern 1, but has the
peculiarity of debiting the supplier for the rejects

while notifying him that the rejects were accepted. This
can be merely following through on the paper-work initiated
by the original rejection, which would be offset by a sub-
sequent correction or a re-billing by the supplier, or
some respondents cannot distinguish between a debit and

a credit. They are given the benefit of the doubt. There
is no suggestion to seek a price adjustment--like pattern
1, it is rated 2. The most complete resolution is
reflected in pattern 6, which follows through on all
aspects internally to the organization, and requests that
the price be renegotiated, by Action 8 write-in, which
would result in maximum satisfaction to supplier and
buyer, and leave all functions in proper control of their
responsibilities. It appears to be both technically and

morally correct and serves prudence and justice--the

162

actions appear to be right, the expected consequences
good--the most complete solution within the limits of the
action choices available, and in accordance with the
criteria in the framework on Figure 3. It is rated 1.

The foregoing is somewhat lengthy, but serves to
demonstrate the analytical and rating process. Greater
brevity will be attempted for the balance of the cases to
be so treated.

The next procedure for Case 1 is to apply the
ratings to patterns and determine what resulted in terms
of the groups, areas, and levels. Before this is done,
an additional explanation is necessary. As previously
indicated, Cases 2, 3, and 4 were presented to the respon-
dents in both the objective and subjective modes, while
Case 1 was not. However, while rating the three cases
according to the two modes it occurred to the researcher
to re-examine Case 1 in the same fashion to see whether
the responses tended to be neutral or to reflect the same
biases as the others. It was found, as is evident in
Table 46, that there was a definite indication of bias
in the case of Group 1, all functions but P & A, and two
of the three levels having a higher mean solution rating
for those respondents who identify with the objective
mode. Group 2 has five of the functions and levels going
in one direction and five in the other. It appears,

therefore, that a measurable number of Group 1 respondents

2163

 

 

 

 

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164

had adopted a consistently objective or subjective "set"
for all four case problems. However, in the aggregate,
both Groups have a total mean average solution rating that
is higher for the objective mode than for the subjective
mode. (This is the first concrete evidence for testing
Hypothesis 1; the individual manager will tend to view
himself as more ethical than other managers). Under

the circumstances, the structure of Table 46 is held to
reflect the objective/subjective mode comparison, and the
findings consolidated with the next three cases before
undertaking a comparative analysis of the individual
functional areas and organizational levels. At that time,
the mean solution ratings are "equalized" (as will be
explained) to remove the effects of over or under-weighting
caused by disparities of distribution of subjective-
objective respondents among the areas and levels. The
present early indication is that Marketing is the least
perceptive of the solution implications in Case Problem 1,
in both Groups, and this seems to carry over into Level 1,
irrespective of the differences as to the objective and

subjective modes.

Case Problem 2

 

This situation involves individual vs individual
in a superior/subordinate relationship, and also individual
vs group in an employee/company relationship. Professional

competence and conduct, objectivity, loyalty, full

16S

disclosure and other accounting concepts, are under con-
sideration. Disobedience and risk of firing or resignation
complicate the issue. The scene was set because of a
previous deviation from rational behavior on the part of
the Profit Center Manager, who involved his Financial
Analyst. There is implied a strained relationship between
the P.C. manager and his superiors, inasmuch as he is
unwilling to have them know that a cost over-run is immi-
nent. In failure to alert them to the situation he also
precludes them from possibly assisting in getting at
causes and finding a solution as well as in making other
adjustments (budgetary, etc.) which might be required.
These are questions outside the immediate issue, which
is what course of action the Financial Analyst should
take, but they point up the consequences of the original
deviation from norms of responsible reporting. Disclosure
of the actual state of Project 3 is inevitable as there
appears to be no hope of reducing costs by $25 M with only
$90 M left to spend, unless mischarging of actual costs
should commence. Other members of the P.C. manager's
organization might also become involved, although less
directly, as the Financial Analyst casts about trying to
find an answer for his dilemma.

Figure 4, Case 2 indicates a considerable diversity
of choice patterns, unlike Case 1, where almost half

chose pattern 1. In this situation patterns 2, 6, and 8

166

draw an almost equal number of respondents, pattern 1
somewhat less, and the remaining five, again an almost
equal number. The responses tend to be keyed to three
basic courses--comply, refuse to comply, or delay.

Pattern 5 indicates unquestioning compliance with the

P.C. manager's request to continue falsifying the report
and is deemed the least desirable, since the Financial
Analyst either places his own short range interests ahead
of that of his employer--the company, or is unaware of the
seriousness of such behavior and could be considered a
professional incompetent. Certainly, the problem remains--
it is rated 5. Pattern 6 is little better, as some of the
respondents suggest the Financial Analyst document his
file in self-protection, while others variously suggest
other accompanying actions which do not alter the fact of
compliance. The problem remains, the company's interests
are placed in jeopardy through its being kept in ignorance,
an obvious injustice inasmuch as the Financial Analyst is
failing to properly do the work for which he is being
paid--referring again to the concepts of reciprocity/obli-
gations/expectations. This, as was pattern 5, would be
considered a moral failure--it is also rated 5. Pattern 8
suggests delaying tactics while counseling with the fore-
men, and privately with the comptroller. In this case,
resolution is delayed, but not for long, as the report is
due in reasonable time and the issue of compliance or

noncompliance must still be faced. In this situation,

167

prudence seems to take precedence over justice to the
company, and would constitute a degree of moral failure--
it is rated 3. Pattern 7 is a refusal to comply, which
places the problem back in the hands of the P.C. manager,
and there is some attempt to seek a solution by counsel-
ing with others, but not with the P.C. Manager himself.
The Financial Analyst is being prudent, and tries to
assure justice to the company, but is deficient in support
of, and justice to, his immediate superior; the solution
is less complete than another--it is rated 2. Pattern 8
has the Analyst resigning or asking for a transfer, in
protest against the request to falsify the report. This
also returns the problem to the P.C. Manager, while call-
ing the attention of others to the seriousness of it,
perhaps thereby precipitating an investigation which
might lead to getting at causes. The Analyst is willing
to sacrifice his job, an action lacking in prudence, and
is trying to be just to his company by refusal to falsify
the report--this is rated 2. Pattern l is simply refusal
to cooperate with the P.C. manager's request, returning
the problem to him for resolution. The analyst is exer-
cising prudence, though risking his job through disobe-
dience, and he is being just to his company, but he lacks
in supporting his superior, a deficiency in justice-—this
is rated 2. Patterns 2, 3, and 4 are similar in calling
for non-compliance with the request to again falsify the

report, but are accompanied by a direct effort to assist

168

in trying to find a solution. It places the responsibility
back with the P.C. manager, and the written comments under
action 8 generally suggest a diplomatic and sympathetic
relationship, firm refusal but strong support. This

would appear to serve best in resolving both the immediate
problem of the Analyst's own dilemma, and work toward get-
ting at basic causes to help solve the P.C. manager's
problem. This approach appears to be technically correct,
prudent as to the Analyst's interests, and just both to
the company and the superior. These three patterns are
rated 1.

Remembering that this case problem was presented
to the respondents in both the objective and subjective
mode, the ratings were compiled accordingly, and the
results are shown in the top third of three successive
tables, one each for the total population by area and
level, for Group 1 by area and level, and for Group 2 by
area and level. As Tables 47, 48, and 49 show, the objec-
tive mean ratings are clearly and conclusively higher
than the subjective mean ratings almost without exception
for all components of all three entities. Marketing
again goes counter to the trend, with a small deviation
in Level 5 and Level 1. However, as mentioned in connection
with Case 1 analysis, the comparative analysis between
areas and levels is reserved for later considerations.

Figure 3 was again referred to for criteria to be considered

.169

 

 

 

 

 

 

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1371

 

 

 

 

 

 

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172

in rating the patterns of action choices in this case.
Hypothesis 1 is additionally supported by the evidence on

Tables 47, 48, and 49.

Case Problem 3

 

Here again, is an individual vs individual in a
superior/subordinate relationship with employee's and
company's interests being equated, as well as a question
of support, this time of the subordinate by his superior.
As the case shows, there is a question of justice to the
employee whose deserved raise in salary is being set aside
because of budgetary constraints. A budget is, of course,
a guide which is intended as an aid in controlling expen-
ditures; it is based on expectations and usually reflects
past experience. Occasionally it is held to be a rigid
ceiling, which seems to be what is happening in the
present case, where it is stated that there is no pro-
vision for the employee's overdue salary increase for at
least six months, things being tight. Possible bad con-
sequences are brought into view--the Junior buyer under
financial stress might be wrongly influenced by a sup-
plier, or he might be forced to seek other employment--

a rather familiar pattern in which the employee's bar-
gaining position is not strong, since his normal
expectations were not provided for in the budget. The
sequence of analysis again begins with the least desirable

solution, pattern 9 does nothing for the employee but is

173

concerned for the company, as these respondents would warn
the Junior not to get involved with the supplier, which
indicates a recognition of the risk but likewise lack of
confidence in the employee's good judgement. There is some
prudential concern for the company but none in justice for
the employee--this morally deficient pattern is rated 5.
Pattern 2 respondents offered suggestions which could be
considered as evading the issue. The situation is not
clarified for the employee, no promises are made, he is
merely exhorted to be patient, but is not assumed to be
susceptible to the supplier's "friendliness." This does
little toward solving the problem, and is rated 4.
Patterns 3, 4, and 5 all provide for informing the Junior
Buyer about the budget limitations, and indicate some
concern about his situation in cautioning him about the
supplier's approach, and even offering a loan, but the
situation is otherwise being accepted. Justice is being
recognized to the extent that the employee is told where
he stands, which enables him to at least evaluate his
position, and some prudential concern is indicated as to
the company's interests, but solution is delayed--these
three patterns are rated 3. Pattern 8 is very similar

to the previous 3, but here the superior moves to pro-
tect his subordinate by himself speaking to the supplier--
this also does not provide a solution--it is rated 3.
Pattern 6 moves closer to a solution as his superior makes

a firm attempt to secure justice for his subordinate by

174

requesting an adjustment in the budget, which could consist
of increasing it or giving lesser priority to other needs.
For a company of any size--and here there are at least
two in the Purchasing department, the economic impact of
one minor employee's salary increase should not be
unbearable. This does not indicate whether there are
similar problems with respect to other deserving employees.
This pattern does not, however, provide for informing the
employee of the true situation, thus keeping him in a
state of anxiety--it is rated 2. Pattern 7 both informs
the employee as to his status and also provides for posi-
tive action toward securing justice for him, although it
does not indicate that there is risk of the supplier's
undue influence, perhaps demonstrating confidence in the
employee's good judgement. It moves about as far as pos-
sible toward a solution, but without any optional sugges-
tions, and it is rated 1. Pattern 1 takes in all three
affirmative actions, as it notifies the employee about
the budget, moves to try for an adjustment in the budget,
and is concerned both about the employee and the company
in the relationship with the supplier. Thus the elements
of technical correctness, prudence, and justice are all
present in considering the interests of all entities,
with a supportive attitude on the part of the employee's

direct superior--it is rated 1.

175

Returning again to Tables 47, 48, and 49, it can
be seen in the center sections of all three, that the
compilation of ratings in accordance with the objective/
subjective modes again supports Hypothesis 1, but not
quite as strongly as in the prior case, Manufacturing and
P & A this time going contrary to the others, and also
Level 5. It is possible that many of these respondents
consider a budgetary limit inviolate, or strong action
by a superior in his employee's interests unusual--which
may be the more general situation in the larger corpor-

ations. This will be re-examined later on.

Case Problem 4

 

This case involves individual vs individual in a
peer relationship, the interests of the company, and the
interests of an employee of a customer. It depicts an
aggressive and opportunistic Sales Manager who appears
to be making an effort to maintain a monthly sales
volume level in the face of a downturn in business. It
appears he induced a buyer to relax a release schedule
to permit an extra shipment to "relieve an inventory
problem," and then took advantage of the opportunity by
shipping and planning to ship much more. It would appear
to be rather short-sighted on his part, since the buying
company's consumption is limited by its own production
schedule, although it could also be an attempt to freeze

out competition by strategically placing his stock on the

176

buying company's premises and forcing a backup in any com-
petitor's shipments. However, it does place the company's
buyer in an awkward and defensive position, and even a
compromising one, if he is required to explain to his
superiors how and why he permitted such a situation to
develop. He has, of course, reacted by calling the sup-
plier company's Production Control office to attempt to
stop the flow of material. In some companies the Sales
department is permitted rather rigid control over schedul-
ing changes on the basis that they are more immediately
sensitive to the buyer's needs. It might be the case here.
However, a problem has been created for the Manufacturing
Manager. He would be concerned about his own responsibil-
ities and is answerable to the General Manager; he should
be concerned about his own company's economic interests
and reputation; he might be concerned about the buyer's
predicament; he might also be concerned about his own
relationship with his peer--who might become his superior
in the near future. It is also conceivable that the Sales
Manager has some undisclosed but legitimate strategy in
mind, such as reason to anticipate an upturn on the basis
of leads from his counterpart in the buying company.
Figure 4, Case Problem 4, shows the patterns of action
choices and indicates a heavy concentration for pattern 2,
due in part to having to combine patterns with elements

of similarity. It is of interest that, in the aggregate,

177

80 of 101 respondents call for a confrontation with the
Sales Manager. Pattern 1 adds to the confrontation a
request to obtain the promised revised releases. This
indicates a concern on the part of the Manufacturing
Manager primarily for his own interests, although the
releases would be a basis for assuring acceptance of
billings for the advance shipments, while ignoring the
buyer's immediate problem. The solution has some ele-
ments of technical correctness and prudentiality but

falls far short of resolving the problem--it is rated 4.
A similar situation pertains in the case of pattern 6,
which confronts the Sales Manager and takes up the matter
with the General Manager. This approach may bring matters
quickly to a head, but may have other consequences in the
nature of strained relationships among the three managers.
It also ignores the predicament of the buyer. It does
place the problem before the Sales Manager, but implies
thereby that there is no other way to deal with it. It
is technically correct in using channels, prudential as
far as the Manufacturing Manager is concerned, and appears
to be indifferent to the interests of anyone else--it is
also rated 4. Pattern 3 also primarily reflects the con-
cern of the Manufacturing Manager only for his own area
of responsibility. It does shut off advance shipments

to the buying company and seeks authorization for what

has already been shipped, and in this way acts in the

178

interests of the producing company. This pattern has
elements of technical correctness, prudence, and some
degree of justice for the company, but it fails to resolve
the problem and leaves untended the problem faced by the
buyer-—it is rated 3. Patterns 2, 4, and 5 represent
solutions in which the issues are faced and attempts made
to rectify the damage. All three call for a face-off with
the Sales Manager, but concern extends to the producing
and buying companies' interests. These three patterns
come closer to resolving the problem, but leave undeter-
mined the consequences stemming from a show-down--they
are rated 2. The remaining three patterns represent a
more low-keyed approach, by-passing a show-down situation
but dealing with the interests of both companies, the
buyer, and the Manufacturing Manager's own area, and also
enable the General Manager to be informed without pro-
voking a negative approach. Thus, there are elements of
technical correctness, prudence, and justice--the means
are right and the expected consequences appear to be
good--all this, of course, within the limits of the action
choices offered or written in--all three remaining patterns
are rated 1.

Returning to the lower third portion of Tables 47,
48, and 49, we find the objective/subjective variance still
in effect, but not nearly to the same degree as in the

previous cases. There is mixed reaction among the areas

179

and levels, but analysis is undertaken later on. These

results add to the support for Hypothesis 1.

The above completes the analysis of the four case
problems which are rated in accordance with the five point
scales on Figure 4 and the solution criteria on Figure 3.
Evaluation of Cases 5 and 6 will be taken up following

the next two sections.

Consolidated Case Problems--Objective/Subjective

 

Mg§§§.--The summation of the data appears on Table 50,
which covers the total population, Groups 1 and 2, and

the components of the areas and levels of all three. As
can be seen, the composite mean solution ratings for the
objective mode are higher for all components in all three
sections with the following exceptions: Level 5 is, in
total and in Group 1, definitely contrary to the trend,
whereas in Group 2's segment they are not. With respect
to Group 1, this is true for all three Case Problems (2,
3, and 4), but is strongest in Case 3. It is not true

for Case 1 on Table 64. Re-examining the frequency dis-
tribution for Case 3 on Table 60 it is found that the
distribution was fairly scattered among Level 5 respon-
dents and happened to fall in such a way that more low
rated patterns identify with the objective than subjective
modes. It can only be concluded, without making a detailed

examination of the data for each respondent, that Level 5

180

 

 

 

 

 

 

 

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181

respondents do not appear to consider themselves more
ethical, as individuals, than other managers. Elsewhere
in Group 1, the Manufacturing area is evenly divided,

again in the aggregate, with Case 3 choices accounting

for the offset. In this case, pattern l--which was rated
1, was selected by more of the objective respondents than
otherwise. Marketing also tends to be almost even in the
aggregate because Case 2 offsets, more of the respondents
in the subjective mode having selected high rated patterns.
For Group 2, the only deviation from the trend is in the

P & A area, where an offset is caused by Case 4, just
enough to cause the solution means to agree for both modes.
However, these are the only exceptions, the balance of

the evidence is so strong as to definitely support Hypo-
thesis l--The individual manager tends to view himself

as being more ethical than other managers, and it is

so concluded.

Comparative Summary of Solution Ratings by Areas

and Levels.--During the discussion about applying the

 

solution rating scale to the pattern choices for Case
problem 1, earlier in this chapter, it was mentioned that
the mean solution ratings resulting from applying the
solution rating scale to the objectively and subjectively
selected action choice patterns would require "equali-
zation." Reference to Tables 46 through 49 will disclose

that the numbers of objective and subjective respondents

182

is by no means equally distributed among the functional
areas and organizational levels. The result of this was
that any average of the composite total of subjectives
and objectives for any area or level would be heavily
weighted in one direction or the other whenever the numr
ber of respondents for each was significantly dispropor-
tionate. To counteract this effect, it was decided to
accept the mean solution rating for the subjective and
objective segment of each area and level for each case

as representing an equal number in each, and to then take
a simple average of the two ratings to represent the
average combined solution rating for each area and level
for each case. For (N=101) the proportions of objective
and subjective responses was 48 and 53; for (N=73) it was
32 and 41 and for (N=28) it was 16 and 12. However, for
the areas and levels the count was as low as l in some
cases, and there are ratios of l to 4 and even one of

8 to 1. Therefore, it was felt that an equalized average
would offset the excessive biases otherwise evident for
many of the components. The two mean averages resulting
from each method were compared, and in many cases little
difference resulted, but the extremes were dampened and
were thereby deemed to be more representative of a
balanced proportion of objectively and subjectively
oriented respondents for each component of the areas and

levels.

183

Table 51 summarizes the average mean solution
ratings for all components for all four of the case prob-
lems so rated, and provides data to test hypotheses:

2. Managers engaged in some business functions will,
as a whole, have significantly different percep-
tions of the solution possibilities of ethical
problems from managers in certain other functions.

3. There will be significant differences in the per-
ceptions of the solution possibilities of ethical
problems between managers from one organizational
level and those from certain other organizational
levels—~the higher the level, the more complete
the solution.

The equalized mean solution ratings of each of the
four case problems are shown for each functional area and
level, and then a simple average of the four case problems.
It must be kept in mind that the ratings were developed
by use of a relatively tight, five-point scale, and that
the data presented are averages of averages. These ratings
are a device for setting up a somewhat arbitrary but uni-
formly applied system of solution scoring and have no pur-
pose but to determine if there are differences when the
scale "values" are applied to the action choice patterns
which were selected by the respondents in each area and
level. It should be remembered, also, that the original
selections of the individual respondents were compressed
into a maximum of nine patterns per case on a "best fit"
basis. The net effect of all this has been to level out

and greatly compress the range of differences which

existed in the data in their original form. Under the

184

 

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185

circumstances, this researcher feels that it would be
inappropriate to apply conventional tests of statistical
significance to the data in such form; in fact, the X2
test so applied produced probability values far above
anything which might normally be termed significant. For
that reason, it is proposed to examine and discuss the
averages in their present form, using only a simple

"range" scale to indicate how far the high and low mean
ratings depart from the average mean for each section.

This researcher feels that patterns and trends are also
informative, in addition to the range of differences.

It had been previously noted that Marketing and
Personnel and Administration areas had exhibited differ-
ences in frequency percentages from those of the others,
and the mean solution averages now reflect this, since they
rank 4th and 5th in "solution perception" while Accounting/
Finance/Systems ranks lst. When the individual ratings
for each case are similarly ranked and the rankings are
added up, Marketing and P & A are consistently above the
others. By way of explanation, this researcher suggests
that Marketing and Personnel and Administration appear to
be less perceptive of the solution content of problem situ-
ations because they are less technically oriented and may
not recognize all the steps or actions necessary to effect
optimum solution of many problems. This might indicate

that functional "distance" from the "locale" of a problem

186

situation in the industrial context tends to impair the
perception of the manager as to its solution content. By
contrast Accounting/Finance/Systems, who rank first in
the total population, in Group 1, and in Group 2, tend to
have a more comprehensive view of the totality of business
problems (other than those which are purely technical in
nature) because of their strategic position in the commun-
ications network, and in receiving and processing data
and preparing reports. Comparison of the functional areas
in Groups 1 and 2 show a basic consistency, with A/F/S
ranked lst, Engineering and Manufacturing either 2nd or
3rd, and Marketing and P & A either 4th or 5th. It seems
quite clear that, according to the measuring techniques
used, and setting aside conventional tests of statistical
significance, noticeable differences in perception of
solution implications exist as between the managers in the
five functional areas under examination, in both Groups 1
and 2, and it therefore appears that the manager's
functional orientation will tend to affect his decision
choices in ethical problems.

Returning to Table 51, the sections presenting
the Organizational Levels can be examined in the same
manner. For (N=101) where all respondents are consoli-
dated, there is no strong trend from low to higher levels,
or vice versa, and the range of difference in average

rating is much less than in the case of the functional

187

levels. Levels 4 and 5 appear to have slightly lower
mean average scores, but this is not evident when the
individual case scores are ranked across the levels.
Examining the three levels under Group 1, there is a
slight trend upward, but the differences in ratings are
so small as to be negligible. When the individual case
scores are ranked across the levels, they add up to exactly
eight for each level. For Group 2 the range of differ-
ences is much wider, but the number of respondents under
each is small. Level 5 has a much lower score than the
other four levels, which is why the total range of dif-
ference is so much larger than for the total population.
Thus, the evidence on Table 51 does not support hypothesis:
3. There will be significant differences in the per-
ceptions of the solution possibilities of ethical
problems between managers from one organizational
level and those from certain other organizational
levels-~the higher the level, the more complete
the solution.
Two case problem situations remain to be examined,

those for which the respondents were requested to express

an Opinion, rather than select a course of action.

Case Problem 5

 

In this situation a manager newly promoted to
executive rank finds that one of the characteristics of
the rank is a requirement to make an annual political
contribution to the party of his choice, in a specified

amount, and through a company representative. The

188

respondents were requested to indicate which one or more
of eight statements best expressed their feelings about
such a requirement. The patterns of selections were many,
but these were also consolidated to nine. These are
shown on Figure 4, Case Problem 5. Each pattern is desig-
nated as "U" for unethical, "E" for ethical, or "U/E"
when the statements divide evenly on either side of the
question. When the data were compiled, a simple per-
centage relationship was developed to indicate what pro-
portion of the respondents considered the practice uneth—
ical, or not unethical. The results are shown on Table 52
in each of the three segments into which the table is
divided. The divisions represent the total, and Groups 1
and 2. In addition to the percentages of response for
each side of the question, a rank is shown for the compo-
nents within the areas and levels, and a "range" is
developed to measure the departure of high and low per-
centage from the average. In the aggregate, a far
greater percentage of the respondents consider the prac-
tice unethical, and among the functional areas, Marketing
has the strongest such opinion, while Manufacturing
objects the least. There is, of course, no technical
aspect to the question. It involves purely a relation-
ship between a higher level employee (executive) and
still higher level members of the group to which he has

been admitted who perpetuate the practice. The company,

189

 

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190

as such, can take no official position in the matter, except
to comply with the law which bars political contributions
by corporations. There is no economic burden placed upon
the executive in view of the nominal amount, at least at
his present level. Thus the question is whether the
executive is being coerced, or is a willing participant
who accepts this as a social responsibility. The
Marketing--Manufacturing extremes carry through both
Groups, and in Group 2 Manufacturing is actually evenly
divided on the question. The other three areas agree at
about 30 per cent for and 70 per cent against.

With respect to the Levels there is also a mixed
pattern, with Level 1 objecting the least and Level 2
the most, which is unusual inasmuch as both levels are
in Group 2 only. Under Group 1, Level 3 has the least
objection, and this might indicate participation in, and
support of, such a program by some of the managers at
this level. It seems clear that the areas and levels
differ in their perceptions of the ethical implications
in this situation, but the reasons are not indicated,
except perhaps that there are participants in such pro-
grams scattered among the areas and levels. It does not
appear, therefore, that functional or organizational
orientations have any bearing on the way the respondents
View this situation, and it may be concluded that these
findings do not indicate support for either Hypothesis 2

or 3. Other than that, the consensus among the respondents

191

is that the practice is more unethical than ethical.
According to the language of the case problem itself,
the executive's participation is "assumed" or taken for
granted, and the individual himself quite likely feels
that it is prudent for him to conform, and that his
interests are best served (and that of the corporation)
in a political climate which made it possible for him to

achieve executive status.

Case Problem 6

 

This situation differs from the others in that it
considers a total environmental situation as well as a
philosophy. Here, again, the ethical/unethical implica-
tions are suggested for the respondent's consideration
and selection in the form of eight statements arrayed
half on either side of the question, which involves the
government's buying practices and the possible bad con-
sequences. The issues are broad and involve the rightness
or wrongness of means used, prudential considerations
from the government's standpoint and its responsibilities
to the taxpayers, and also justice to entire industries
and their many employees. There is no question as to the
impact on industry and the national economy of large
increases or decreases in the government's buying in
connection with any given program.

Figure 4, Case Problem 6 shows the action choice

patterns and the designations which form the basis for

192

compiling the respondents' selections as they deem the
government's buying practices, as described, ethical or
unethical. The results of the compilations are also shown
on Table 52, where it is clear that the large majority,

73 per cent, consider the situation ethical. Group 1 is
stronger in its Opinion than Group 2, wherein one
functional area and two levels are actually split on the
question. In the case of Group 1, there is an indicated
trend among the three levels, with the percentage increas-
ing (in favor) from level 5 to 4 to 3. Among the
functional areas, the P & A area is especially strong,
with the Manufacturing area lowest. It is possible that
among the respondents are some who have experienced
lay-off and termination as a result of government contract
completions or cut-backs. There seems to be no consis-
tency as between the responses of the areas and levels
under Groups 1 and 2. Neither of Group 2's functional
areas or levels, in their responses, appear to provide

a basis of support for Hypotheses 2 and 3, although there
are substantial differences indicated in their relative
perceptions of the ethical content of the situation. As
for Group 1's levels, the trend might indicate that the
higher levels are more adjusted to and suPportiVe Of the
kind of free enterprise system under which we operate,

and this might explain the responses of P & A, and A/F/S,

and possible Marketing, whereas Manufacturing and

193

Engineering might be more aware of technical complications
involved in doing business with government agencies. The
question of support for the two hypotheses must remain
open, with respect to Case 6, for later consideration.

Evaluating the Case Problems for
Ethical Content and Quality

 

A complete explanation of the evaluation basis and
process was made in the early portion of the chapter. The
procedure is depicted on Figure 5. The objective is to
determine the relative proportions of Prudence and Justice
in the solutions--the action choice patterns--by individual
respondents to the case problems, and to compile the results
in order to compare groups and functions (levels are ex-
cluded) and to test Hypothesis 4. These results are
shown on Table 53.

As Figure 5 shows, the basis for comparison is the
difference between two percentages representing the relative
proportions of Prudence and Justice in the consolidated
totals of the groups and functions. For convenience, this
difference is termed the "bias factor," and it indicates how
far in the direction of Prudence or Justice the case problem
solutions tend. This indicates whether the groups or func-
tions perceive differently the ethical aspects of case prob-
lems, and to what extent they may have a tendency to depart
from balancing self-interest and the interests of others in

their decisions. The comparisons are relative, rather than

194

Area: Engineering, N = 17

Totals of Cases # 1 through 4

 

Action Internal External
Choice P/S JZC J/OP P/C J/OP J/OC T/R

 

 

 

 

 

l.

4. (VARIOUS)

 

 

 

 

Totals 53/17 15/17 43/17 44/17 - 33/17 64/17

Factors
Prudence 3.12 2.59

Justice .88 2.53 - 1.94

Technical
Rightness 3.77

Total Prudence 5.71

II
U1
H
U“!

Total Justice 5.35

II
b
m
0
U1

Total 11.06 100.0

Bias Factor: 51.5% - 48.5% = 3.0% toward Prudence

 

Prudence; J = Justice; T/R = Technical
Rightness

Terms: P
8

Self; C = Company;

OP = Other Person; CC = Other Company

 

Figure 5.--Basis of Evaluation of Case Problems for
Ethical Content and Quality.

1195

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196

absolute; that is, no judgment is made of the ethics, per
se, of the groups or functional areas. The comparison is
made of their perception and treatment of ethical problems
relative to each other.

Referring to Table 53: The most meaningful com-
parison is that under the subjective mode. This isolated
all the responses of those who had placed themselves as
subjects in the problem roles. In total, Group 1 tends
slightly in the direction of Prudence--l.6 per cent, while
Group 2 tends rather strongly.in the direction of Justice-—
8.6 per cent. The conclusion is that Group 2 is less self-
interested than Group 1, and since Group 2 is comprised of
the more religious managers, this provides the test for,
and therefore supports, Hypothesis 6: The more religious
manager will be more concerned about the interests of
others and less concerned with self-interest than the less
religious manager. Previously mentioned findings as to
personal, influential, and environmental variables relat-
ing to Group 2 had already indicated this, and now serve
to bolster the evidence in this case problem.

Looking at the functional areas (still in the sub-
jective mode), differences among the areas are clearly evi-
dent in Groups 1 and 2, although in opposite directions,
except for Marketing. This area leans quite strongly in
the direction of Justice to others--8 per cent in Group 1.

Manufacturing area in Group 1 also tends firmly toward

197

Justice, but the opposite is true in Group 2. However, the
numbers of Group 2 respondents in these areas is too small
to consider these findings valid. In Group 1, Engineering,
P & A, and A/F/S tend firmly in the direction of Prudence,
but the underlying data show that this is more strongly
directed toward self than for the firm's interests. In the
objective mode the results clearly support the findings
relative to Hypothesis 1:

The individual manager will tend to view himself as
more ethical than other managers.

The overall direction for both Groups, as Table 53
shows, is strongly opposite to that in the subjective mode--
toward Prudence, and more so in the case of Group 1. The
functional areas in the objective mode are generally much
stronger in the direction of Prudence, except for Engineer-
ing in Group 1 which went opposite--toward Justice; no ex-
planation has been found for this. In Group 2, Marketing
is also opposite to the trend, leaning toward Justice.

According to Hypothesis 4:

Managers engaged in some business functions will,

as a whole, reflect different proportions of

prudence vs justice in their ethical problem solu-
tions from managers in certain other functions.

The evidence represented by the data on Table 53
seems clearly to support this, although somewhat less in

the objective than in the subjective mode; but in this

there is a built-in negative bias, since the managers were

198

requested to "consider an average (manager)" in the case
problem role, and their tendency was to ascribe self-
interest to such managers.

In general, it appears that Personnel & Adminis-
tration, and Accounting/Finance/Systems tend to have
stronger concern for company interests, perhaps from hav-
ing a broader overall view of the business; Engineering
tends to be more self-interested, perhaps due, in part, to
having a more limited view. By contrast, Manufacturing
appears to have concern for others, possibly due to being
product oriented; and Marketing exhibits strong concern
for others--which would be the customers, but this may
also combine self-interest--their view may be that what
benefits the customer also benefits them.

In the aggregate, most respondents tend toward
self-interest, although Group 2 has two areas, Engineering
and P & A, which seem to have balanced prudence and jus-

tice, their bias factors being zero.

Preliminary Summary of Case Problems

 

The research hypotheses dealing with the sample in
total, in groups, and in functional areas appear to be well
supported by the case problem findings, while that dealing
with organizational levels does not. These findings also
seem to be bolstered by findings relating to personal, in-
fluential, and environmental variables. A good deal of

additional information comes into view, both negative and

199

positive, much of it in underlying detail, which may be of
value in further research. The case problem findings will
be combined with those in the previous chapter, and will be

further interpreted and discussed in the concluding chapter.

Influences Perceived in Subjective/Objective Mbde

 

Case Problems.--The respondents were requested to indicate,

 

in connection with each case problem, which three of the
Influences they had rated under Part II of the question-
naire now appeared to have a bearing on the problem in
question. Because of the division of Case Problems into
the two modes, objective and subjective, the influences
designated by the respondents for Case Problems 2, 3, and
4 were so classified and then ranked in accordance with
their relative frequencies of selection. The results--
rank positions only--are shown on Table 54. As can be
seen, all respondents agreed upon "own Ethical Standards"
as being the most significant, which is not surprising,
considering the nature of the questionnaire. Next in
order was "Company's Economic Interest," following which
the objectives and subjectives begin to divide. Three

of the influences are not cited at all in connection with
the three cases--"Wife's/Family's attitude," "Legal Con-
straints," and "Society's Interests." The influence
which had been rated by far the lowest in Part II, "Fear
of Losing Job," comes strongly into view in 6th rank by

the objectives for Case 2, indicating that they considered

200

 

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201

this a major concern of the Financial Analyst in that
situation. There was practically no difference between
the two classifications as to the relative frequency of
citing influences identified with the A-O-S trichotomy.
But there is, in the strength of the rankings when aver-
aged, a noticable difference, as the subjectives'
responses place Self-Oriented influences first, Authority
second, and Organization third; while the objectives
place Authority and Organization oriented influences in

a tie for first place, and Self third, which indicates
that the subjectives were more conscious--in these cases--
of their own professional competence and personal integ-
rity. This helps to explain the basis on which they per-
ceive themselves as being more ethical in their roles in
the case problems. The comparative ranking of these two
influences is 3.5 by the subjectives, and 7 by the objec-
tives. There are differences in the ranking of any given
influence as among the cases. For example, "Company
Economic Interest" is ranked lst in Case 4, and 4th in
Cases 2 and 3; "Own Ethical Standards" is lst in Case 3,
2nd in Case 2, and 4th in Case 4--and so on. This indi-
cates that the nature of the ethical content in the
individual cases elicits perceptions of different influ-

ences at work in each situation.

202

Influences Perceived in All Case Problems
Setting aside the objective/subjective classifications
and viewing all influences in the aggregate for all the
case problems, the comparative frequencies of citations
are given on Table 55 for Groups 1 and 2 and in total.
The first, second, third choices have been consolidated
with no weights assigned. Approximately 28 per cent of
the respondents in each group had misinterpreted the
instructions and had cited action choice numbers instead
of influence numbers, or had intentionally omitted
citations, and these omissions are also noted. Groups 1
and 2 perceived the same influences among those ranked
lst through 4th--Own Ethical Standards, Own Personal
Integrity, Company Economic Interests, and Customer/
Supplier Welfare. For the 5th, Group 1 perceived Company
Policies, which Group 2 ranked 6th, while for the 5th,
Group 2 perceived Own Religious Beliefs, which Group 1
ranked 16th. Both Groups agreed on Company's Reputation
as 7th. Group l's 6th ranking Own Professional Competence
was ranked 11th by Group 2. There is little difference
in the way each Group ranks the remaining Influences per-
ceived as bearing on the case problem situations. It is
noted that all eighteen influences received some consid-
eration, the lowest being Wife's/Family's Attitude and

Fear of Losing Job, which were cited a total of 15 times

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mu NN ml. NN H N NH ml NH H N mummuoucH N.NuuHooN NH
NH NN NH NN NH N NH HH HH N N mmnsuNNNN .NmuNcHouonam NH
N NN N NN NH NH N N NH N N NH N N N NH N coHuNusamm N.Ncoasoo NH
N NHH N NN N N N HH H N NN N N N NH N muNNsz uoNHmmsmxuaaouNso N
NH NN NNH HN NH NH N NH NH .NH H NH wosuHNNN museum ummm N
N NNH N NNH N NH H N N N N NN N H N N N mummumucH oHEocoom Nammeoo N
cmucmHuo coHuMNHcmmuo
NN.NN NN.NN NN.NN
H NNN N NNN H NNH NHNuoN
NH HN mm NH N N NH NH NH «H mu N NH mucHNuuNcou Hmmmq NH
HH NN .NH NH NH NH NH HH N .N NN N N N N N N NNmNHmm NaoHNNHmN :30 HH
H NNN H NNH N H N H N N H NN H H N H H H Noumccmum HNuNnum :30 NH
NH NN NH NN NH N NH N N N NH NH NH N N N wusuHNNN N.NoNH>umNaN N
N NN N NN HH N N NH N N N NH NH N N N N N mvsuHuum usufiwmmcmz mos N
N NN N HN N N N N N N N NN N N N N N N mmHoNHoN Ncmmsoo H
vmucmNuo NuNuonus<
Nam .vmum Nam .Nmum N N N N N H xcm .vaN N N N N N H
mmocmnchH
pocHnEou Hmuoe occhmm SmHnoum mmmu Hmuoe mcchmm EmHnoum mmmu
iHNHuzc ANNuzc H macho HNNuzc N Nacho

.meuou new .mmsoum uonE .mEmHnoum mmmo Mom

vw>Hmonmm mwocmuscHau.NN mamas

204

each. The comparison by Functional areas is shown on
Table 56, and for the Organizational Levels on Table 57.
On Table 56 are shown the frequencies and rankings
of the influences perceived in the case problems by the
functional areas under both Group 2 and Group 1. The data
for the six cases have been consolidated, and no compi-
lation was made for the areas under total population
(N=101). Instead, a single column designated as "Mode
rank" is shown at the extreme right of the Table for
purposes of general comparison. A single asterisk has
been placed by each rank which deviates either from the
modal column or from the other rankings in the line by
3 rank positions or more, for convenience in identifying
the more apparent differences. These indicate the extent
to which the functional areas differ from one another in
their perceptions of the influences which appear to have
some degree of application in the case problems. The
greatest differences involve the following influences:
Top Management Attitude, Own Religious Beliefs, Own Eco-
nomic Interest, and Own Professional Competence, cited 4
or 5 times, while those cited 3 times are, Supervisor's
Attitude, Company's Reputation, Subordinates' Attitudes,
and Own Personal Integrity. With respect to the remaining
ten influences, the areas are in fair agreement, under
both Groups. Looking at the number of citations by indi-

vidual areas, P & A area under Group 2 has seven and ENG

205

NNNNNNIM
HH H H

I N
H

MIDV'VDMCD
H

 

 

 

 

 

 

 

 

 

mvoa scum nGOHunH>oo Nana: .

 

 

 

 

 

N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH omnucuouom
NNN NHN NNN NNH NNH NNH NN NN NNH NN NHouoa
NH.NH NH.NH «N.NN NN.NN «N.NN NN.NH NN.NN NN.N «N.NN NN.NN
NN NN NNH NN NN NH NN N NN NN mucomuum oz
NN.NN «N.NN NN.NH NH.NN NN.NH «H.HH NN.N NN.NH NN.NN NN.N
N NN N NN N NN NH NN N NN N NH N N N NH .N NN N N NHuuoa
mm N [NH N mm N mm H .NH N 1| 1| mm H mm H m1 N acoHunuHNNa uoouuu :30 NH
N NN N NN N NN H NH .N N N N .N N .N N N NN NuHumoucH Hocomuom :30 NH
NH N NH H NH N .NH N NH H NH N N H non chuoq No “can NH
N NH N NH .N NN N N .NH N .NH N .NH H N N .HH N mucouoasoo HmcoHunououN axe N
NH N HH N NH N .N N .N N .N N NH N N N nuaououcH uHsocoom :30 N
NH N NH H NH N .NH N NH N NH H .N N oosuHuu< N.NHHENN\N.0NN3 N
coucmHuo «Hum
NN.NN NH.NN «N.NN NN.NH «H.NN NN.HN «N.NN NN.NN NN.HN NN.N
N NN N NN H NHH .N NN H .NN N NN H NN N NN .N NN N N NHuuoe
_ mu NH mm N m: HN NH N N|.N .NH N .w1 N N: N m: N m: N ounououcH N.NuoHooN NH
. NH NH NH N .N N NH H NH N NH H .N N .N N NH N monuwuu<.uauucHouonsm NH
M N NH N HH N NH .N N «N HH N N N N .N N N N coHuuuanum N.Ncoqsoo NH
. N HN N NH N NN N N N N N HH .H N N N N N muuuHoz uoHHmm=N\uuaoua:u N
NH N NH N .HH N NH N NH H oosuHuu< macaw uuon N
N NN N NN N NN N N N NH N NH N N N NH N N N N munmuoucH oHeocoom Naoneoo N
uwuauHuo :ONuuuHacmuo
NN.NN NN.NN NN.NH NN.NH NN.NN NN.NN NN.NN NH.HN «N.NN NN.NH
H NNH H NN N NN N NN N NN H NN N NH H NN H NN H HH NHuuoa
NH N LMH N HH N .mn H .NH H II mm H NH N .NH H In nucHuuuucoo Hummq NH
NH N NH N NH N .N N N N .N N .N N .N NH N H uNaHHom aaoHNHHom :30 HH
H NN H NN H NN .N N H NH H NH N N H HN H NN N N nououcoum HuoHnum :30 NH
.N NH N N N N .NH H .NH N N N NH H N N HH N N N unsuHuu< N.Noafl>uoanm N
NH NH .N NH .NH N .N N NH N NN N N N HH N NH N ousuHuua unusuuocmz nos N
N NH N NH N NH N N N NH N N N N N N N N N N uoHuHHom Naomaoo H
noucoHuo NuHuosusc
xx .Umum xx .Uoum xx .wmum xx .vouh xx .voum xx .Uouh Mm .Umum Mm .vmum xx .woum xx .Umum
m\m\¢ «an ozu 09:: um: m\m\< «an uzu wax: om:
NH NH NN N NH N N N N N uz moocozHucH

 

 

ANNuzN H macaw

 

ANNuzc N mnouo

 

.mmmum HocoHuocsu an .UwumcHHomcoonumEoHnoum ammo uou nw>HmoHom moocmnHuculu.NN mqm<e

206

has five; under Group 1 MKTG and MFG both have seven, while
ENG has four. The areas with the least number are MKTG
under Group 2 and A/F/S under Group 1. These findings are
taken into account in testing Hypotheses 2 and 3, and on
later Tables for Hypothesis 5. Of interest, also, is the
percentage of "No response" frequencies and related per-
centages. In the case of MFG under Group 2 this percentage
is so high as to tend to invalidate the remaining data in
that column as being insufficient to be meaningful. In
Group 1, P & A and A/F/S have the lowest percentages of

no response and this appears to have an implication that
they analyzed the case problems more thoroughly and were
more involved in following through. It can also be seen
that the areas differ with respect to the way the weight
of influences cause a variance in the way they rank the
A-O-S groupings. In both groups Marketing places Orga-
nization oriented influences third, and in Group 1, Mar-
keting places Self-oriented influences first.

Proceeding to Table 57, this shows the comparison
by organizational levels. It has already become obvious
that many variables with respect to which differences
appear when viewed in the functional context seem to have
those differences dispersed in the organizational levels
context. In the present case only Own Religious Beliefs
is noticeably different, with six citations. None of the

others have more than two except Company Policies, with

207

 

l N
H

MIDV‘OMO
H

 

 

 

 

 

 

 

 

 

 

 

0008 aouu maoHuuH>wo Nona: N
N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH N.NNH umoucmouwm
NNN NNN NNN NN NN NNH NN NNH NHuuoe
NN.NN NN.NH NN.NN NH.HN NN.NN NN.NN NN.NN NN.HN
NHH NNH NNH NH NN NN NN NN Nacommum oz
NN.NH NN.NN NN.NH NN.NH NN.NH NN.NH NN.N NN.NN .
N NN N NNH N NN N N N NH .N NH N N N NN NHuuoa
mm N .Mm NH mm N . II. I: «M1 N In .wm H unoHuouHNNN uomuuo :30 NH
N NN N NN N NN m.N N N N N NH .N N N NH NuHumoucH Hmcouuom :30 NH
NH N NH N .NH N _ NH H .N N NH H non NNHNoH No NNNN NH
N NH N NN N NH .NHH N N N .NH H NH H NH N mucouomaou HunoHNNmNouN :30 N
NH N HH NH NH NH _ HH N NH H NH N NH H .N N NuumumucH oHeocoom czo N
.N NH NH N NH H _ NH H .N N NH H unauHuuc N.NHHaNN\N.oNN3 N
m ouucmHNo NHoN
NN.NN NN.NN NN.NN _ I NN.NN NN.NN NN.NH NN.NH NN.NN
N NN N NNH N NN N NN .H NN N NH N NH .H NN NHuuoa
{Mm N mu NN .Mu NH _.mu N .Mu N M1 N m: N mu N NNNNNNNNH N.NumHooN NH
NH N NH NH NH N a HH N .N N .N N NH H NH N NooauHuum .NouucHNuonsN NH
.H NN N NN N NH N N N N .NH N N N N N coHumusNuN N.Ncaasoo NH
N NH N NN N NH N N N HH N N N N N NH muuNHoz uwHHaasmxumsoumao N
NH N NH N NH N NH H opsuHuux N.xaouo ummm N
.NH N N NN N NN N NH N N N N .N N N NH NuuououcN UHanoom Ncaqsoo N
coucoHuo coHuuNHcamuo
NN.NN «N.NN NN.HN «N.NN NN.NN NN.NN NN.NN NN.NN
H NN H NNH H NN H NN H NN H NN H HN .N NN NHNuoa
.mu NH «4 NH mm N II mm H .mm N mm H II NacHuuuncoo HNNoN NH
HH N .NH N .NH N .N N NH H .N N .N N .N N NNNHHNN NsoHNHHmN :30 HH
N HN H NN H NN H NH H NH H NH H NH H NH Ncuuucuum HNoHnum :30 NH
N N NH NH .N NH .N N N N NH N NH N NNNNHNNN N.NoNH>umasN N
N N N NN HH N NN N N N .N N N N uvsuHuuN ucmsmmmqux mos N
N HN N NN N NH N N N N .NH N .N NH .NH N NuHoHHoN Ncoqeoo H
cuucuHuo NuHuoNNNN
xx .Uuux xx .Uoux xx .vmux xx .vaum xx .gmux xx .wmum xx .vmum xx .Umux xx .kux xx .vmux
N-H N-N N-N N-N H-N N-N N-N N-N N-N H-H
NH NN HN - - N N N N N uz NmocmsHN:H

 

 

ANNuz. H aaouo

 

ANNuzN N macho

.mHm>0H HN¢0HuoNHcmouo an .omumcHHONcoo .mEmeoux ammo NON po>Hwouom moucosHucHuc.Nm mamas

208

three asterisks, which denote differences of three or more
rankings. With respect to individual levels, there is
greater variance in Group 2, where Level 3 has eight and
Levels 2 and 5 have five citations each, as also has

Level 5 in Group 1. It would appear that the manager's
organizational level is less closely identified with
perception of influences present in problem situations
than his function in the organization. In terms of A-O-S
groupings, Levels 1 and 4 in Group 1 were more strongly
perceptive of Organization oriented influences, which are
ranked first--in the case of Level 4 it is really a tie
with the Authority oriented group. Only Level 3 in Group 2
places Self-oriented influences above third place in the
group rankings.

The next series of three Tables provides a com-
parison between the influences for which a ranking was
established under Part II of the questionnaire through
use of the rating scale, and the influences for which
ranking was established according to the frequency with
which they were perceived to be operative in the case
problem situations. Since the previously considered dif-
ferences with respect to the subjective/objective mode
analysis on Table 54 involved only three of the six cases,
the possible effects of such differences are being ignored
in the present comparisons of influences rated with influ-

ences perceived. Table 58 compares the rankings for

209

x. . .
“:M.’.N1N.§1ihlm‘. L

. '

 

mmcchmu smmsumn mmocmumMMHp mono: N

 

 

 

 

 

 

 

N N HNN N N NNN N N NN mHmuoa
m: N «H NN m1 N mm NN mm mm N mcoHumuHNNN ummuoo :30 NH
H N NNH H N NHH H N NN NuHuNmucH Hmcomumm cso NH
NH NH NH NH NH NH NH NH N non NchoH «0 “NNN NH
N N N NN N N N NN N N HH HH mocmuomeoo HmconmmNouN :30 N
NH NH NN NH HH HN NH HH HH mummumucH oNeocoom czo N
NH NH NH NH NH HH NH NH N mcsuHuuN N.NHHENN\N.NNH3 N
omucmHuo NHwN
N N NNN N H NNN N N NNH. mHmuoa
«H N mu NN mm N m: NN «H N mu NH NummumucH N.NumHooN NH
NH NH NN NH NH NN NH HH HH mmcsuHuua .mmumchuonsN NH
N N NN N N NN N N NH :oHumusamN N.Ncmmeoo NH
NH N N NHH NH N N NN N N NN mumNHmz uwHHmmsm\umsouNso N
NH NH NN NH NH HN NH NH H mosuHuuN N.Nsouo “NNN N
N N NNH N N NNH N N N NN NummuwucH 0Heocoom Ncmmeoo N
pmucmHuo coHumuHcmmuo
H H NNN H N NNN H H NNH NHmuoN
Mu.N NH HN mu N mm NH ml N «m mu NucHNuumcoo HNNNH NH
NH HH NN NH NH NH N N N NN NNmHHmm msoHNHHmN :30 HH
N H NNN N H NNH N H NN Ncumocmum HmoHnuN :30 NH
N NH NN N N NH NN HH NH NH mosuHuu< N.NomH>ummsN N
N N NN N N NN NH N NH monuHuu< unmemamcmz doe N
HH N N NN HH N N HN N N N NN NmHuHHoN Nammeoo H
cmucmHuo quuonusx
Nam Nam .wmum xam xcm .vmum xcm xcm .vmum
HH NcoHumuHo HH mcoHumNHo HH NcoHumuHo mmocmsHNcH
uumx mmmu uumx mmmu uumm mmmu
xHNHuzN omcHneoo ANNuzN H macaw ANNuzN N acouu

 

.mmsoum an .HH uumx

2H cmxcmu mwocmsHmcH qu3 pmummeoo mEmHnoua mmmu Mow Um>Hmonm mmocmsHmcHun.mm mque

210

Groups 1 and 2, also providing the total frequencies of
selections under the case problems to enable better under-
standing of their relative importance, which rankings
alone tend to obscure. An asterisk between two rankings
denotes those which differ three or more places in rela-
tive rank. Group 2 has six, and Group 1 has seven such
citations. There are four as to which both groups reflect
the same kind of differences between rated significance

in general and perceived influence in specific situations,

“if... ‘Nn‘NNa-m-u-n—u-fi as. &+.?

and these go in the same direction. They are: Company
Policies and Society's Interests, which were more prominent
in the cases than in the general ratings, and Legal Con-
straints and Own Professional Competence which were less
in evidence in the case problems than in the general
ratings. Of the remainder, Group 2 saw Religious Beliefs
as less apparent and Company Economic Interests as more
involved in the case situations than in their general
ratings. Group 2 perceived Supervisor's Attitude and
Own Career Aspirations as less important, and Customer/
Supplier Welfare as more important in the cases than in

a general view of their significance in their decision-
making. Differences are to be expected, since the case
problems situations cannot be considered as being suffi-
ciently comprehensive in the aggregate to involve all
eighteen influences in substantial degree. But it is

rather remarkable, under the circumstances, that there is

211

such close conformity between the two sets of rankings.

This would indicate that the initial ratings wherein the

eighteen influences were rated in direct comparison with

each other are a quite accurate indicator of the manager's

perception of their relative significance on his decision—

making, which application in even a hypothetical problem i

situation tends to confirm. This concerns Hypothesis 5: E
Managers engaged in some business functions will, 4
as a whole, have significantly different percep-
tions of the relative importance of non-technical ’
influences which may affect their decisions in L
ethical problems from managers in certain other
functions.
Table 59 compares the relative rankings of the

functional areas. Looking across all ten components com-

prising both Groups, those Influences which, denoted by

asterisk, have differences for six or more of the areas

are: Company Policies, Own Religious Beliefs, Legal Con-

straints, Customer/Supplier Welfare, Subordinates' Atti-

tudes, Society's Interests, Own Professional Competence

and Own Career Aspirations--or eight out of eighteen. In

most cases they are in the same direction fairly consis-

tently across the areas, perceived to be either more

apparent or less apparent in the case situation than in

the general ratings. Those that run counter to the trend

on any line, and are not split, are denoted by an asterisk

in parenthesis. Looking at individual areas, the count

of major deviations--differences of three ranks or more--

212

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HH uumm :N omxcuu mmocwoawcu u
mEmHnoum ommu :N pmuNo mwocwsHmcH n

 

Amy
Ntv

 

 

 

 

 

HNN HNN HNHN ANHN HNHN ANN AHHN HNN HNN N¢\z. n mcoHuNN>mo uoflmzN
N N N N N N N H N N N N N N N N N N N N NHNuoa
MIN mm «IN mm MIN mm MIN mm MIN mm mm II mIN 1: mm Mm mm mm mmHNNN acoNucuHmuN umuumu :30 NH
H N H N H N H H N N N N N H N N H N N H N N NuwummucH Hmnomumm cso NH
NH NH NH NH NHN NH NHN NH NH NH NH NH NH NHN NH NHN N non mchoq No HNNN NH
N N N N N N N N N N N N N NH N N NH N N NH HHHNNN N N HH N mucoummaoo HuconmwuouN :30 N
N N NH NH HH NHN NH N N N N N NH N N NH NH NHN N NH mumoumucH UHEocoom azo N
NH NH NH NH NH NH NHN NH NHN NH N NH NH NHN N NH NH wcsuHuuN N.NHNENN\N.NNH3 N

noucwHuo NHNN
N N N N N H H N N H N N N H N N N N N N mHmuos
mu m'. Ml fl mi WI: .vlmi ION m: c' m. m m; VI m. NI. m1 ml NIH: N mumwuwuHNH mlmuwunoom ma
NHN NH NHN NH NHN N NHHL NH NH NH NHNN NH NHN N NHN N NHN NH NH mwnsuNuum .mmumcHNuonsm NH
N N N . N N N NHNN N N N N N N NH N N N N N N N :oHumunmom N.Nnmmsoo NH.
NHN N NHN N NHN N N N NHN N N N N N H N N N N N HH mumunz uoHHmmamxumaoumso N
NH NH NH NH NHN HH NH NH NH NH NHN NH NH NH NH wwsuHuuN m.m=ouu uwum N
N N NHN N N N N N N N HHN N HHN N N N N N N N mummuwucH oNsocoum Ncmmeoo N
omucmfiuo coNumNchmuo
H H H H H N N N H N Ml|||m MIIIIMI mulllmu annual willlm NHNuoN
N N mm N N mm N N mm NHHNNmm NHN um N I: N N mm N N mm mu mm wm mucHNuumcoo HNNNH NH
NH NH NHN NH NH NH HHN NNNNN H N N N N N N N N N N NN N muwHme msonHHom :30 HH
N H N H N H N N N H H N H N N N H N H H N muumvnmum HmoNnum :30 NH
N N N N N N NH NH NHNNNH NHN N NHN NH N N HH HH NN N wusuHuuN N.NONH>umm3N N
NH NH N N NHNN NH N N N HH NH NHN N N N NHN NH HH NN H mnsuNNNN ucmswmmcuz moa N
HHN N HHN N HHN N NHN N N N NHN N NHN N N N NN N NN N NoNuHHom acumeoo H
NoucoHuo NuHuonusN

m < m N m N m N m N m 4 m < m N m N m N
m\m\¢ NNN ozm wax: um: N\N\< NNN ozm max: out mmocuuscH

NH . NH NN N NH N N N N N uz

Anhuzv N macho Ammuzv N macho Aumcuo xcmmv
N
.mwwhm
HmcoNuocsw an .HH unmm :N cmxcmn mwocwsHu:N nuNs umummEoo mEmHnoum ommu now co>amoumm mwocmsHucHll.Nm mam<9

213

is shown in a parenthetic figure at the bottom of the

pair of columns for each area. In Group 1, Marketing has
the highest such number, indicating that their perception
of influences in the case problems differs most from their
general rating of those influences under Part II. In

Group 2, P & A has the highest such score. The counts

p.
I

for the rest tend to fall between 8 and 10, indicating

that with respect to about half of the influences the

 

functional areas tend to perceive them in varying degrees
of significance in concrete vs abstract contexts.

A similar kind of comparison is made on Table 60
for the organizational levels. The comments made with
respect to the differences in rankings of each influence
as viewed across the ten functional components of the
two groups can be made almost without exception with regard
to the eight component levels of the two groups. These
same differences are evident except that they come to
fewer numbers because there are only eight instead of ten
columns. Looking at the individual levels, Level 4 for
Group 2 has the highest number of differences--l4, while
in Group 1 it is Level 5 with 11. The balance of the
areas have between six and nine differences. As before,
the differences tend to run in the same direction, those
that are contrary being denoted with an asterisk enclosed

in parentheses.

ZJJI

“L. N
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HH puma cw omxcmu mmocochcH n Hmv

 

 

 

 

 

mEmHQOHQ mumo H.HH fiflvfio mQUGODHHGH n 33
AHHN ANN ANN ANN “NHN ANN ANN ANN mcoNuNH>mo Noflmz N
N N N N N N N N N N NANNN N N N N mHmuoe
«IN mm mIN mm mIN ma mm It mm. II MI. MI MN II mm.wm NcoHumuHmmc umuumo :30 N
N N H N H N N N N N N H N H N N H N NuHNNmucH Hmcomumm :30 N
NH NH NH NH NHN NH NH NH NHN NH NHN N NHNNH non NchoH No ummm N
H N N N N N N N N HH HH H N N N N NH N NH N NNH mocmummsoo Hmcoflmnomoum cao N
NH NH NH HH HH NH NHN HH NHNNNH NHN NH NHN NH N N muumumucH oNsocoom :30 N
NHN N NH NH NH NH NANNNH NHN N NH NH NH NH monuHNNN N.NHHENN\N.NNH3 N
omucmNuo NHoN
N N N N N N N N N N H N _N N N N H NHNuoe
MM. Ml NNN Ml flwa MI MN: NI wMa Ml NNN MI «mi N! MduMl mummuwucH m.humwoom m
HHrNNH NH NH NHN NH NHN HH NHN N NHN N HH NH HH NH monsuHuuc .mmumchuonsN N
N N H N N N N N N N N NANNNH N N NN N :oHuNuammN N.Ncmmsoo N
NHN N HHN N NHN N N N N N N N N N N N N muumHoz uoNHmm=N\umsouuso N
NH NH NH NH NH NH NH NHN NH NH NH NH mosuNNNN N.Nsouo umwm N
NANNNH N N N N N N N HHN N N N NHN N NN N mummumucH oHsocoum Ncnmeoo N
poucmwuo coNumNNcmmuo
H H H H H H H H H H H H H H H N mHmuoa
ml m: MIN «m .NIN mm MI II MIN mm NI mm MIN mm mu II NucNmuuNcoo Hmmmq N
NHrNHH NH NH NHN NH H N N N N NH N N N N NN N NNNHHmm msoHNNHmN cso H
N N N H N H N H N N H N H N H N H Noumccmum HmoHnum :30 N
N N N NH N N NHN N NHN N NH NH N N NH NH unsuHuuc N.NoNH>Nmasm N
NHN N N N NH HH N N N NANNN HHN N NHN NH N moauHuu< ucmswmmcuz mos N
N N N NHN N N N N N N N N N NH NH N N NH NH moNuHHoN Ncagsoo H
ouucmwuo mufiuonusc
m N N 4 m N m N N a N a m m m N m N
N-N N-N N-N Nuq H-N N-N N-N N-N N-N Hug mmocmsHNcH
NH NN HN - u N N N N N uz

 

NNNuzN H msouo

 

Ammuzv N macho

Humouo xcmmv

 

.me>mH

HmcoHuouHcmmuo Nb .HH uumm CH cmxcmu mmocouscN nuHs pmnmmfiou mEpooum ommo MOM om>Hoouom moocwuscHnn.oo wands

215

The following sums up the data and also considers
the evidence for testing Hypothesis 5, which states:

Managers engaged in some business functions will,
as a whole, have significantly different percep-
tions of the relative importance of non-technical
influences which may affect their decisions in
ethical problems from managers in certain other
functions.

A Q“m
a

It appears that (a) the differences in the cita-
tions dealing with the case problems objectively and sub-

jectively on Table 54 show that the managers differentiate

 

their applicability; (b) the variances in the rankings

by the respondents in the six different case problems on
Table 55 is evidence that the managers perceive them as
being more or less significant in differing situations;
(c) the differences in their rankings by the functional
areas and organizational levels on Tables 56 and 57 for
the consolidated citations of the case problems indicate
that functional perceptions of their relative significance
vary; (d) the differences and directional trends when the
case problem influences are compared with the rankings
resulting from the general and abstract ratings under
Part II, as seen on Tables 58, 59, and 60, indicate that
the managers are sensitive to their having different
importance in varying situations--all these would tend to
support the hypothesis. It is, of course, quite obvious
that certain "basic" influences have a somewhat general
kind of application, such as: Own Ethical Standards, Own

Personal Integrity, and Own Religious Beliefs, which many

216

of the respondents have cited throughout. However, most
of the other influences have a more specific application,
and the evidence seems quite clear that the majority of
the respondents have a fairly accurate perception of their

applicability in specific situations. It would appear to

follow, therefore, that having a conscious awareness, and ,

recognizing that often that awareness may not be oriented

 

to as highly structured a list as that under analysis, the

.Lu.‘ "I

manager is responsive--within whatever his limitations may
be--to such influences, and that they tend to affect his
decision making in varying degrees. This is to say that
purely technical and economic variables are not the only
factors which enter into a business decision where ethical
considerations are involved. The manager is aware of

and may be, in varying degrees, responsive to non-technical

and non-economic influences of the kind under discussion.

Correlation of Case Problems with Certain Var-

 

iables.--The computer program provided for running a num-
ber of correlations to determine if the action choice
selections would reflect the influence of any of the other
variables under study. The results were disappointing

and occurred for primarily two reasons. A number of runs
were made using the original action choice patterns. It
turned out that there were too many variations, resulting
in a spread of frequency distributions such that any

which gave rise to significance levels of interest turned

217

out to be isolated cases of little importance. Secondly,
the inclusion of non-response frequencies had a distorting
effect, being in themselves the basis for false signifi-
cance levels within the range of interest. Nevertheless,
all such readings were checked out in the hope of identi-
fying useful relationships. None of these contributed
anything of value.

One of the correlations was to have been the basis

for testing Hypothesis 7: L'
The perceptions of organizational climate held by J
managers in one function will differ significantly
from those held by managers in certain other
functions.

A related reason for the ineffectiveness of this

test attempt was that the data on the relationships them-

selves produced no significance levels within the range of

interest. In those instances where significant differ-

ences seemed to be indicated, they were caused by frequen-

cies for Level 1 respondents who had no superiors, or for

staff managerial personnel who had no subordinates. In

addition, only three positions on the four-place scales

were utilized, all respondents reporting, for example,

their relationships with superiors, peers, and subordinates

as being very good, good, or fair, none reporting poor

relationships.

In those cases where correlations were attempted

with case problem action choices which had been consoli-

dated, the results were equally fruitless. For example

218

the influences frequencies were those identified with

the valuation scale used for Part II, which was ordinal,
and the case problem patterns also gave an illusion of
ordinality because the patterns were numbered from 1 to 9,
but the numbers, as such, had no significance other than

identification.

Summary of Findings--Case Problems
and Related Influences

 

The findings in this chapter provide the data
for testing all of the research hypotheses of this study.
The outcome has already been indicated in most cases, and
will be formalized and further elaborated upon in the next
chapter. The findings of this chapter will be combined
with those of the previous chapters to furnish answers to
other questions in addition to providing information rela-
tive to the tests of hypotheses. Examination and manipu-
lation of the data also provided other information of
value to the area of interest of this study. This will
also be brought into view in the next and final one of the
five chapters comprising this thesis.

The reader is reminded that there are some limita-
tions on the reliability of the data developed by this
study due to the size of the sample, specifically the dis-

parate numbers of respondents in the various functional

areas and organizational levels as shown in prior Table 23:

e.g., 7 (9.6 per cent) in Marketing; 12 (16.4 per cent) in

:Personnel and Administration; vs 28 (38.4 per cent in Engi-

neering--in Group 1.

-- 9.- _I H-N—l cu“.- Inn-P. "L'—

CHAPTER V

SUMMARY, CONCLUSIONS, AND RECOMMENDATIONS

Introduction

 

This study has undertaken an investigation of the

internal and external forces impinging on the decision-

WW” .ficw‘A-N‘Mauillé- find! a 14"}

making process of managerial personnel when ethical con-
siderations are involved. In the view of some writers all
deliberation, and thus most decisions, have ethical and/or
moral implications. The first chapter introduced the
general problem and related hypotheses and questions and
also brought into focus the viewpoints of a number of
writers on general and business ethics from which certain
criteria were derived by means of which the ethical con-
tent and quality of action choices might be evaluated. The
second chapter described the methodology, research proce-
dures, and the means by which the data were gathered from
the 101 respondents who comprised the survey population.
The third chapter presented, discussed, and summarized
the findings relating to the personal, influential,

and environmental variables according to which the
components of the survey sample were compared and

among which were sought those which might help to explain

219

220

the decision-making behavior of managers in situations in-
volving ethical problems. The fourth chapter analyzed and
evaluated the ethical content and quality of the decisions
of the managers with respect to a series of hypothetical
problem situations involving ethical considerations and
also the influences which they perceived as being opera-

tive in these case problems. The survey sample had been E

 

stratified into two groups, five functional areas, and 5

five organizational levels, and all data were compiled

”pm-r. N.’

and the findings discussed and analyzed in terms of this
pattern. This chapter sets forth the outcome of the hypo-
theses tested, also bringing into view the related var-
iables, and discusses other questions for which answers
may or may not have been found. The conclusions and
recommendations derivable from the aggregated findings

then follow.

Summary of Findings

 

Hypothesis 1: The individual manager will tend to
view himself as more ethical than other managers.

 

This is supported by the findings derived from the
analysis and evaluation of the action choice patterns for
the case problems which had been presented in both the
objective and subjective modes. In terms of both com-
pleteness and ethical content and quality, the subjective
mode responses showed higher ratings and less bias in the
direction of self-interest than did those in the subjec-

tive mode. It is clear that the majority of the responses

221

in the objective mode attributed to the case problem sub-
jects a less favorable pattern of behavior than when the
respondents subjectively assumed the role of the subject.
The groups, functional areas and organizational levels all

responded in the same manner, that is, in the same

direction, although to varying degrees. A related 5
finding is that the respondents tended to rate two of 2
the eighteen influence variables quite low--Peer Group's E
Attitude, and Subordinates' Attitudes, and also, among the i

L

environmental variables, perceived the attitudes of peers
and subordinates toward ethical problems as somewhat less
positive than those of higher levels.

Hypothesis 2: Managers engaged in some business
functions will, as a whole, have significantly
different perceptions of the solution possibilities
of ethical problems from managers in certain other
functions.

 

This is also supported by analysis and evaluation
of the action choice patterns for the case problems, after
adjustment for the objective/subjective bias. There is a
consistency in the differences as among the functional
areas, both in the mean average solution ratings for each
Case, in the totals, and in the rankings. Analysis of the
"technical rightness" content of the case problems also
supports this finding; Engineering and Accounting/Finance/
Systems scored highest, and Personnel & Administration and
Marketing lowest in this characteristic. It would appear

that functional "distance" from the locale of the problem

222

situation, perception of technical factors, sensitivity to
consequences, and knowledge of the proper means of reso-
lution may be among the reasons for the differences in
ratings. In the case of Accounting/Finance/Systems, their
strategic position in the communications network, prepar-
ation and analysis of data and reports, and the like, may
aid in their perceiving the issues more clearly. A related
finding--Perception of Company Goals, also gives evidence

of a form of "functional bias."

Hypothesis 3: There will be significant differ-
ences in the perceptions of the solution possibil-
ities of ethical problems between managers from one
organizational level and those from certain other
organizational levels--the higher the level, the
more complete the solution.

This hypothesis is not supported by the evidence
derived from this sample. The same testing procedures
were applied as for Hypothesis 2, but the ratings and
evaluations were mixed, and there was but very small indi-
cation of a trend in Group 1 levels. Very few of the
variables investigated appeared to have a direct rela-
tionship with organizational level, per se, and none of
these could be identified as having a general bearing on
decision problems, with the possible exception of per-
ception of subordinates' attitudes. This influence
variable was ranked lower by higher levels.

Hypothesis 4: Managers engaged in some business

functions will, as a whole, reflect different pro-

portions of prudence vs justice in their ethical

problem solutions from managers in certain other
functions.

223

This hypothesis is supported by evaluation of the
action choices selected by respondents for case problems
in the subjective mode, in terms of the relative content
of prudence and justice reflected in these selections.
Group 1 managers in Marketing had a strong bias in the
direction of justice--concern for the interests of others.
The Manufacturing area also tended in the same direction,
but not to the same degree. By contrast, Engineering,
Personnel & Administration, and Accounting/Finance/Systems
were, progressively, more strongly oriented toward pru-
dence--concern with self-interest as opposed to that of
others. An important distinction is made, in that prudence
has two aspects, (1) the individual's own prudential self-
interest as opposed to the interests of all others includ-
ing his firm, (2) the individual's prudential concern--
as a managerial employee--for the interests of his firm
as opposed to that of all others. In the case of all three
of the last mentioned functional areas, prudential concern
for own personal self-interest was more heavily weighted
than prudential concern for the firm's interests--as com—
ponents in the prudence vs justice (in)equation, while
the opposite was true for Manufacturing and Marketing.
.Justice is also multi-faceted, (1) justice which the indi-
‘vidual owes to his firm and other persons, (2) justice
which the firm owes its employees, other persons, and

<3ther firms or groups. It would appear that role and

.1
T7,
\

7r.ur_-, _. - .

_.-_.. VI:

 

224

function underlie the biases which are evident in such
relationships in the business context, and that managers
may not be aware of them as such.

This test is also supported by the way these
functional areas perceived the relative importance of
nine categories of company goals, Marketing being cus-
tomer oriented, Manufacturing being product oriented,
Personnel & Administration having a social consciousness,
while Engineering and Accounting/Finance/Systems were
more expansion minded. All had placed profit first. A
test of respondents in the objective mode placed most
more strongly in the direction of prudence, but because
of personal self-interest attributed to the case subjects
by their objective observers.

Hypothesis 5: Managers engaged in some business

functions $111, as a whole, have significantly

different perceptions of the relative importance
of non-technical influences which may affect their

decisions in ethical problems from managers in
certain other functions.

 

This hypothesis is supported by the respondentS'
citations of the specific influences they perceived as
being operative in the individual case problems, each
case giving higher or lower ranking to the selected
influences. Added support was provided by the comparison
of the relative rankings of the eighteen influences which
were rated and ranked under Part II of the questionnaire
in the abstract, that is, without reference to concrete

situations such as the case problems. There is strong

 

225

agreement on certain "basic" influences, such as, Own
Personal Integrity, and Own Ethical Standards, and Com-
pany's Economic Interests--in both the abstract and con-
crete. Setting aside the one influence which so strongly
differentiates the two groups--Own Religious Beliefs, the
functional areas perceive in varying degrees of importance

such influences as Customer/Supplier Welfare, Own Career

_--__._T.-_m-.--
_ ‘ N. . n. ' N- .. ‘ - v I»
'I.

Aspirations, Company's Reputation, Top Management Atti-

JT'

tude, and Own Professional Competence. Although these
are identified as influences which impinge on the indi-
vidual there is clear indication of a role relationship,
that is, the individual manager may tend to perceive cer-
tain influences rather than others in a given situation
because of his particular role or function. Such a rela-
tionship was not so evident with respect to the organi-
zational levels.

Hypothesis 6: The more religious manager will be

more concerned about the interests of others and

less concerned with self-interest than the less
religious manager.

 

This hypothesis is supported by the findings of the
case problem evaluations in connection with Hypothesis 4.
The Group 2 managers had a much stronger bias in the
direction of Justice (in the subjective mode) than did
the Group 1 managers. This tendency is further supported
by the relative rankings of influences, wherein Group 2
managers ranked Customer/Supplier Welfare higher than

did Group 1, and also in their perception of Company

226

Goals, where they showed a stronger awareness for the
interests of Customers and Employees, than did Group 1
managers. In the aggregate ranking of self-oriented
influences vs Organization-oriented influences, Group 1
managers ranked Self before Organization, while the reverse
was true of Group 2 managers. Inasmuch as the influences

are related to the individual, the interpretation is that

 

Group 2 managers are less concerned with their own per- i
sonal interests as opposed to the interests of other indi- 5
viduals, and would not imply that Group 2 managers neglect
the interests of the companies which employ them.

Hypothesis 7: The perceptions of organizational

climate héid by managers in one function will dif-

fer significantly from those held by managers in
certain other functions.

 

Due to the ineffectiveness of attempted tests of
correlation, as well as to the fact that the majority of
respondents reported a generally favorable situation,
there was no valid basis, with the present sample, to
test this hypothesis. It is felt that this would be an
important indicator, in the setting of a single industrial
firm, of the presence and effects of high level pressures
and problems with hygienic factors.

To sum up, it appears that the organizational
orientation of the manager measureably influences his
decision choices in problems involving ethical consider-

ations.

227

It is believed that the weight of the above evi-
dence, even in the absence of support for two of the hypo-
theses, supports the above statement. The evidence indi-
cates that many variables must be considered, some having
positive implications and some negative, and that the

effects vary in each unique situation. Therefore, the

manager's perception and evaluation of the elements of a

given decision situation should not be limited to the ,

 

purely technical and economic factors, but he should be

H’i‘T " o '

aware of the probability that many other variables require

consideration to improve his decision-making.

Other Findings

 

Besides the findings brought into view in testing
the hypotheses and the descriptive variables which dif-
ferentiate the groups, functional areas, and organizational
levels, a number of others merit attention.

With respect to Group 1 managers:

1. Managers in the upper half of the sample age
range differentiated less sharply between the ethical and
unethical aspects of the problem situations in Cases 5 and
6. The younger managers divided on a basis of 21 per cent
to 79 per cent, while the older managers disagreed on a
basis of 32 per cent to 68 per cent. This might indicate

a higher tolerance level on the part of the older manager,

228

or dulled sensitivity to the ethical aspects of problems
due to greater comulative exposure over time. (A separate
analysis had been made.)

2. Although 34 per cent of these managers indi-

cated that religion was very important to them, by a rating

. “I;

of 6 or 7 on the seven-point scale, only 8 per cent iden-
tified church/spiritual activities among the nine cate-

gories of personal interests. This low interest is more

 

consistent with the ranking of 15th given for Own Religious 5

n“

Beliefs among the eighteen influences. This might be
indicative of a greater tendency on their part to com-
partmentalize their interests than the Group 2 managers.

3. More than 44 per cent reported the ethical
attitudes in their work environment as being uncertain or
negative. This may be a clue as to the marked difference
in the objective/subjective modes of action choice selec-
tions. In other words, their lower opinion of the "aver-
age manager's" case problem behavior may reflect their
real life experiences in their work place. Of course,
each is, in a sense, pointing his finger at the other.

4. Of nine categories of company goals, these
managers perceived "Pleasing the Customer" in 7th place,
which would seem to be a rather negative commentary with
respect to the general climate in their respective com-

panies.

229

With respect to Group 2 managers:

1. The distinguishing feature of this religiously
oriented businessmen's group is that they do not compart-
mentalize their activities, carrying their professed

religious beliefs into their business lives. They are,

‘ mm

of course, more conservative in their views than the mana-
gers in Group 2.

2. The more religious manager ranks the influence

‘
‘3‘ N
x N
"- m

of his Own Religious Beliefs highest among the eighteen,
together with Own Personal Integrity.

3. He is more consistent in this respect, inasmuch
as he had also designated the importance of his religion
to him at the high end of the seven-point scale, and he
also ranked Church/Spiritual activities highest among the
nine categories of personal interests, with Family next,
and Work following.

4. The median age of the more religious manager
is higher, and he seems to prefer the smaller organization
as a place of work, often operating his own business.

This may be an indication that he finds the large organi-
zation climate less compatible with his religious views
and prefers a situation with less conflict.

5. The lower level of educational achievements
of the sample drawn may be reflected in a less comprehen—
sive perception of the technical aspects of problem

situations. The sample included only those members of

 

230

the businessmen's group who were in industry; a large
number of the others are in the professions where the
educational requirements are correspondingly higher.

6. The more religious manager appears to be more
perceptive of the interests of people, in that he indi-
cates a higher concern with Customers and Employees, among
the nine categories of company goals.

With respect to the Functional areas, (limited to

Group 1 as being more characteristic of managers in the

um '..12 ._.,,_ V-L' 1' “1'13." "NH.N :4!)

general case than those in Group 2):

1. Manufacturing managers were older; rated
religious importance highest; were least interested in
hobbies; were more interested in personal social rela-
tionships; rated Company Policy higher as an influence
on decisions; were second lowest in annual earnings; per-
ceived their own situation in the company as least fav-
orable; had the least difference in solution rating as
between subjective and objective modes; had a subjective
bias in the direction of justice, but a strong objective
bias in the direction of prudence; perceived organization-
oriented influences more strongly in the case problems.

2. Marketing managers ranked personal financial
security highest and family interests lowest; had studied
religion, ethics, logic, and psychology more; ranked Cus-
tomer/Supplier Welfare and Subordinates' Attitudes highest;

had ranked Own Religious Beliefs, Legal Constraints, and

231

Own Career Aspirations lowest; had ranked organization-
oriented influences first, authority second, and self
third--in complete contrast to the others; had reported
the lowest annual earnings; perceived own situation in the

company as most favorable; after profit and growth, per-

 

pl
ceived market expansion as most important and community ;:
interests least important; had a more favorable perception i
of businessmen's ethics in general; were least perceptive i
of the solution possibilities in the problem situations;

L*

were strongest, subjectively, in bias in the direction of
justice; perceived strongest the self-oriented influences
in ranking of the influences in the abstract as compared

to those seen in the case problems, and the greatest con-
trast in the authority-organization-self orientations in

the abstract ratings vs those in the case problems.

3. The Engineering managers had the least amount
of graduate education; the lowest percentage of member-
ship in professional organizations; among personal activ-
ities, ranked hobbies highest, and self-improvement and
personal social activities lowest; had studied least the
four subjects--religion, ethics (especially), logic and
psychology; were at neither extreme in the rankings of
the eighteen influences; perceived company ethical atti-
tudes as least favorable; perceived market expansion as
least important of company goals; had the least favorable

perception of businessmen's ethics in general; were second

232

highest in earnings; had the best perception of problem

solutions in the objective mode, and second best in the

subjective mode; were closest to balancing, in total,

prudence vs justice in the case problems--but in this

they were opposite to the trend of the others, being

subjectively biased in the direction of prudence and t

objectively in the direction of justice.
4. The Personnel & Administration managers had i

the highest percentage of graduate degrees; were second

lowest in rating religious importance; were highest in

membership in professional organizations; had the highest

ranking for community affairs among personal interests;

had the highest rankings of Top Management Attitudes and

Society's Interests, and the lowest for Company's and

Own economic interests among the eighteen influences on

decisions; perceived company ethical attitudes highest;

perceived Product Improvement and Employee's Interests

lowest among company goals; had the most favorable per-

ception of businessmen's ethics in general; had the least

favorable solution ratings in both the objective and sub-

jective modes, and were least perceptive, after Marketing,

of the solution possibilities of the case problems in the

aggregate; had the strongest bias, by far, in the direction

of prudence in the ethical evaluations of the case prob-

lems, and also the strongest in total; perceived authority

oriented influences as the strongest in the case problems;

233

and with A/F/S, had the least range of differences in
rankings of the eighteen influences in the abstract vs
those perceived in the case problems.

5. Accounting/Finance/Systems managers had

expressed lowest rating of the importance of religion;

"7.7

ranked community affairs lowest among personal interests;
ranked religion lowest, with Marketing, among the eighteen
influences; were highest in earnings; perceived Product

Improvement as the 2nd most important company goal; had

 

n-\ .
‘N
N

the widest range of difference in solution ratings in the
objective vs subjective modes, including the highest sub-
jective and second lowest objective solution ratings; had
the best solution rating of case problems in the aggregate;
had the strongest bias in the direction of justice in the
subjective mode problems; and with P & A had the least
range of differences of rankings of the eighteen influ-
ences in the abstract vs those perceived in the case prob-
lems.

With respect to the Organizational Levels (those of
Group 1 only): Certain variables had a directional trend;
the following increased going up the levels: Business
Administration degrees, professional membership, ranking
of Top Management Attitude, interest in hobbies, perceived
positive attitude of company toward ethics, improved rating
of solutions in the objective mode. The following decreased

going up the levels: ranking of the following influences--

234

Legal Constraints, Subordinates' Attitudes, Professional
Competence; rating of solutions to case problems in the
objective mode; aggregate solution ratings of case prob-
lems; of the influences perceived in the case problems,
Level 3 ranked self-oriented influences highest, Level 4
the organization-oriented influences, and Level 5 the
authority-oriented influences.

It is evident that few variables have a strong

 

relationship to organizational level in the present sample,

'1’“

and a number of the trends indicated above have a rather

limited range of difference.

Conclusions

 

The major conclusion was stated in summing up the
hypotheses above--the organizational orientation of the
manager measureably influences his decision choices in
problems involving ethical considerations. This is to
say that the manager's perception of the ethical content
of problem situations is affected by his functional role,
his technical comprehension of the issues involved, the
influences he perceives as being operative in each unique
situation, and also by his perception of himself and his
inter-relationships in the organizational context. In
addition, he brings into the problem situation his own
attitudes, beliefs, and values. All of these influences
bear in varying degrees on the individual manager. He

responds in varying degrees to influences identified with

235

authority--both internal and external to the firm, with
his organization, and with his own self-interest. His
responses indicate whether he is more strongly oriented
to authority, organization, or self. His responses vary
as he identifies more or less strongly with a given situ-
ation--in the objective or subjective sense, and the dif-
ference in response can be considered a tendency toward
bias.

The problem situation which involves ethics is, by

”fie—Imm— a” m‘-:‘“ - mnfi
' N; ‘1'

its nature, a situation which involves a conflict of inter-
ests. The problem of the manager is to accurately per-
ceive and evaluate the extent of conflict and to select

a course of action which most equitably balances and
resolves the conflicting interests. He must be able to

see what he ought to do, and he must be able to do what

he ought to do, and the outcome must be as good as possible
for all concerned. It has been seen that managers in dif-
ferent functions respond differently to the same situations,
thus a functional bias may be present, which may be due in
part to differences in technical comprehension, and in
varying ability to see all aspects and solution possi-
bilities which merit consideration. It can also be seen
that the manager is subject to various constraints on

his behavior, some of which may be preventive and some
compelling in their effects. He may not always feel free

to do what he ought to do. Subjectively he may perceive

236

and prefer one course of action, but objectively he may
perceive and incline toward another. Managers also vary
in the degree to which they balance self-interest with the
interests of others, both as individuals and in their
functional roles. In the industrial context there are
personal and impersonal aspects to ethical problems, as
individuals deal with individuals as such, and also as

individuals representing groups with other individuals

 

representing groups. Differences in functional bias may

é
‘3
2::
p

be due, in part, to differences in such relationships.

In the general case, that is, with respect to the
managers in Group 1, the influence of professed religious
beliefs was not as evident as in the special group of mana-
gers comprising Group 2. Comparison of the responses of
the two groups with respect to a number of variables
clearly indicates that the more religious manager is less
inclined toward self-interest than the less religious
manager, and that he appears to be more concerned with
individuals as such. It would appear that the degree of
religious commitment of the manager is reflected in a
stronger bias in the direction of justice--concern with
the interests of others, than towards prudential concern
for self.

Manufacturing managers appear to be about mid-
range among the five areas in their perceptiveness of

solution possibilities of ethical problems and have a

237

definite bias in the direction of prudential concern for
company interests, combining the objective and subjective
responses.

Marketing managers appear to be least perceptive
of the solution possibilities of ethical problems, have
a bias in the direction of justice in the aggregate, and
the widest range of difference between objective and sub-
jective content--prudence vs justice, in the ethical 1

evaluation.

 

Engineering managers have a comparatively high
perception of solution possibilities of the ethical prob-
lems, and were closest, in total, to balancing prudence
and justice. However, this conclusion is somewhat quali-
fied because of an unexplained bias in the direction of
justice, contrary to trend, in the objective mode cases.

Personnel and Administration managers appear to
have a comparatively low perception of the solution pos-
sibilities of ethical problems and have a very strong bias
in the direction of prudential concern, but directed toward
self rather than company.

Accounting/Finance/Systems managers appear to have
the best perception, among the five functions, of the
solution possibilities of ethical problems and have a
definite bias in the direction of prudential concern,
but for self more than for company, and in both the objec-

tive and subjective modes.

238

Group 1 and Group 2 managers both have, in the
aggregate, a bias in the direction of prudential con-
cern, but that of Group 1 is, comparatively, twice as
strong, Group 2 having a relatively greater content of
justice. The total solution rating of both groups was
almost identical, but the technical perception of Group 1
appears to be superior.

In view of the above evidence it seems clear that
ethical problems in the industrial context have a high
degree of complexity and require consideration of a large
number of significant variables in addition to the purely
technical and economic factors which may be involved.

It would appear that the ethical continuum in the
business environment is less broad than in the general
case. The larger the organization and the more impersonal
the relationships, particularly group-to-group, the less
likely it is that the manager's ethical sensitivity will
be involved with that end of the continuum tending toward
personal self-sacrifice in the sense of Christian ethics.
It would appear that his obligation to be concerned about
the interests of others within the business context would
be limited by his specific role. However, the higher he
rises, the greater is his span of responsibility, and the
stronger are the consequences of his decisions on the
interests of others. Adequate criteria and guidelines

laré available for the right-minded manager by which to

WNW N NE“. “W .2 ""~ -HH?

239

evaluate his own intentions, the rightness of his actions,
and the goodness of the expected consequences. The moral
imperatives to treat other persons as ends always and
never as means only; to see oneself in others; to be

truly objective in balancing prudence and justice--wou1d

appear to be adequate for most business situations.

Recommendations

 

The practical answer to the question posed by
Walter Koch, as cited in the first chapter--how and when
to apply ethics in a business situation--would appear to
be, not simple, but realizable. The manager has been seen
as being sensitive to the ethical implications in problem
situations, although his perception of solution possibil-
ities may be limited or impaired by functional bias,
technical inadequacies, impersonality, excessive bias in
the direction of prudence or justice, and other personal
and environmental influences and constraints. It would
appear that, if he could be made aware of and remain sen-
sitive to the variables which merit consideration, he
could also be assisted by a practical framework of ethical
criteria, such as shown in the schematic representation
shown in Figure 3, and explained by writers such as those
cited in the first chapter. In addition, and perhaps of
paramount importance, he needs the positive support and
encouragement of top management in maintaining the highest

possible standard of ethics in his business decisions.

T

”#W‘w M: u .4.

240

Such support would be predicated on the conviction
that good ethics are not only possible, but absolutely
necessary in the business environment. Top policies should
clearly and unequivocally state that no employee, no
matter what his level in the organization, has the right

to require another employee to lie, cheat, or steal for

N " Ir.

the benefit of the company or any other individual employee
in it. Fundamental is the concept that in the large modern

corporation, the one characteristic which all members have

W m‘.‘ um mn- “my: NI:- ‘FI. NP?
4 .. . ,..
‘t—_._ _.

in common is that they are all, first of all, employees--
from chairman of the board to sweeper, and that exploi-
tation of fellow employees begins when that concept is
abandoned.

The specific recommendation is made that the pos-
sibilities indicated by this exploratory research be
further investigated. It is believed that the research
instrument here used can be refined into a reliable
descriptive/diagnostic/predictive device for analyzing
the ethical content and quality of managerial decisions,
and that the techniques experimentally tested in this
study--of making logical analyses of the ethical content
of problem situations--can be further developed, together
with a rational means of comparing the decision choices
of organizational components and individuals dealing with
problem situations. The framework of ethical criteria,

the solution rating scale, and the method of determining

241

to what degree prudence and justice are in balance--are
specifically referred to for this purpose. A replication
within one large organization would be an effective test
of the validity of the approach attempted in this study,
and could result in a good measurement of ethical climate

in that organization.

W“ O‘AW‘M: mam. f)

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”I'm:

- i .
—‘ f , .
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Elli... i hEVUthI a

9. Hi... It

APPENDI CES

6.408]

 

APPENDIX A

COMPOSITION OF ETHICAL CONTENT AND QUALITY

OF CASE PROBLEM ACTION CHOICES

252

TABLE A-l.--Summary--ethical content and quality--percent-
age of prudence and justice in case problem action choices,
by functional areas.

 

Grand Totals

 

 

 

 

 

 

 

Total Group 1 Group 2

P J P J P J
MFG 52.0 48.0 52.1 47.9 53.2 46.8
MKTG 48.1 51.9 48.6 51.4 47.7 52.3
ENG 49.7 50.3 49.6 50.4 50.0 50.0
P & A 55.6 44.4 57.6 42.4 50.0 50.0
A/F/S 50.6 49.4 52.1 47.9 47.6 52.4
Totals 51.0 49.0 51.8 48.2 50.8 49.2

Subjective Totals

 

 

 

 

 

 

 

Total Group 1 Group 2

9 J 9 J p J
MFG 49.1 50.9 47.6 52.4 52.0 48.0
MKTG 45.1 54.9 46.0 54.0 41.7 58.3
ENG 50.8 49.2 51.1 48.9 47.7 52.2
P & A 49.3 50.7 51.7 48.3 44.0 56.0
A/F/S 49.3 50.7 52.7 47.3 41.5 58.5
Totals 49.5 50.5 50.8 49.2 45.7 54.3

Objective Totals

 

 

 

 

 

 

 

Total Group 1 Group 2

P J P J P J
MFG 54.7 45.3 54.7 45.3 54.4 45.6
MKTG 50.0 50.0 54.5 45.5 48.7 51.3
ENG 47.9 52.1 46.9 53.1 57.1 42.9
P & A 60.0 40.0 60.8 39.2 57.1 43.9
A/F/S 52.3 47.7 51.3 48.7 53.8 46.2
Totals 52.6 47.4 52.8 47.2 52.3 47.7

 

TERMS: P = Prudence; J = Justice

TABLE A—2.--Subjective mode-~ethica1 content and

.253

action choices.

quality of case problem

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

N= 41 12 53 7 6 21 7 12
Summary-Subjectives Total
Grp 1 Grp 2 Total Mfg Mktg Eng P&A A/F/S
Int-P/S 2.99 3.00 2.99 2.62 2.33 3.01 3.40 3.25
J/C .80 1.00 .85 .81 .67 .86 1.14 .75
J/OP 2.39 3.50 2.65 2.57 3.00 2.75 2.29 2.58
Ext-P/C 2.42 2.67 2.48 2.81 2.33 2.70 1.95 2.25
J/OP .08 .08 .08 .33 .17 -o- .17 -o-
J/OC 1.97 2.17 2.01 1.93 1.83 1.95 1.90 2.33
T/R 3.46 3.08 3.37 2.98 2.83 3.68 2.88 3.50
Total P 5.41 5.67 5.47 5.43 4.66 5.71 5.35 5.50
Total J 5.24 6.75 5.59 5.64 5.67 5.56 5.50 5.66
T/P % 50.8 45.7 49.5 49.1 45.1 50.8 49.3 49.3
T/J % 49.2 54.3 50.5 50.9 54.9 49.2 50.7 50.7
N: 5 5 17 5 9 2 1 4 2 3
Group 1 Group 2
Mfg Mktg Eng P&A A/F/S Mfg Mktg Eng PsA A/F/S
Int-P/S 2.25 2.20 3.12 3.35 3.33 3.50 3.00 2.50 3.50 3.00
J/C .95 .60 .88 1.00 .56 .50 1.00 .75 1.50 1.33
J/OP 2.40 2.80 2.64 1.80 2.11 3.00 4.00 3.25 3.50 4.00
Ext-P/C 2.70 2.40 2.59 1.90 2.11 3.00 2.00 3.00 2.00 2.67
J/OP .25 .20 -o- .25 -o- .50 -o— -o- -o- -o-
J/OC 1.85 1.80 1.94 1.85 2.22 2.00 2.00 2.00 2.00 2.67
T/R 3.20 2.80 3.78 3.05 3.56 2.50 3.00 3.25 2.50 3.33
Total P 4.95 4.60 5.71 5.25 5.44 6.50 5.00 5.50 5.50 5.67
Total J 5.45 5.40 5.46 4.90 4.89 6.00 7.00 6.00 7.00 8.00
T/P % 47.6 46.0 51.1 51.7 52.7 52.0 41.7 47.7 44.0 41.5
T/J 8 ' 52.4 54.0 48.9 48.3 47.3 48.0 58.3 52.2 56.0 58.5
TERMS: P = prudence; J a justice; T/R = technical tightness

S = self;
0C a other company

C 3 company;

OP - other person

“mammaluorwigkfilmg .n- 51??

254

TABLE A—3.--Objective mode-~ethical content and quality of case problem
action choices.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

N= 32 16 48 7 10 12 9 10
Summary-Objectives Total
Grp 1 Grp 2 Total Mfg Mktg Eng P&A A/F/S
Int-P/S 3.40 3.19 3.33 3.29 3.10 2.89 4.11 3.40 f!
J/C e66 .63 065 .43 .80 .67 044 080 ’l
J/OP 2.68 2.50 2.62 3.14 2.30 3.16 2.11 2.40 '*
Ext-P/C 2.69 2.44 2.60 3.43 1.80 2.74 2.89 2.40
J/OP -o- .06 .02 -o- .10 -o- -o- -o-
J/OC 2.10 1.94 2.05 2.00 1.70 2.30 2.11 2.10
T/R 3.00 2.94 2.98 3.00 2.90 3.09 2.67 3.20
Total P 6.09 5.63 5.93 6.72 4.90 5.63 7.00 5.80
Total J 5.44 5.13 5.34 5.57 4.90 6.13 4.66 5.30 Li
T/P % 52.8 52.3 52.6 54.7 50.0 47.9 60.0 52.3 L}
T/J % 47.2 47.7 47.4 45.3 50.0 52.1 40.0 47.7
N= 5 2 11 7 7 2 8 1 2 3
Group 1 Group 2
Mfg Mktg Eng P&A A/F/S Mfg Mktg Eng P&A A/F/S
Int-P/S 3.40 3.50 2.78 4.29 3.43 3.00 3.00 4.00 3.50 3.33
J/C .60 1.50 .73 .43 .59 -o- .63 -o~ .50 1.33
J/OP 3.20 2.00 3.17 2.14 2.29 3.00 2.37 3.00 2.00 2.67
Ext-P/C 3.60 2.50 2.63 3.00 1.86 3.00 1.63 4.00 2.50 3.67
J/OP -o- -o- —o- -o- -o- -o- .13 -o- -o- -o-
J/OC 2.00 1.50 2.23 2.14 2.14 2.00 1.75 3.00 2.00 2.00
T/R 3.00 3.00 3.19 2.71 3.00 3.00 2.88 2.00 2.50 3.67
Total P 7.00 6.00 5.41 7.29 5.29 6.00 4.63 8.00 6.00 7.00
Total J 5.80 5.00 6.13 4.71 5.02 5.00 4.88 6.00 4.50 6.00
T/P % 54.7 54.5 46.9 60.8 51.3 54.4 48.7 57.1 57.1 53.8
T/J % 45.3 45.5 53.1 39.2 48.7 45.6 51.3 42.9 43.9 46.2
TERMS: P = prudence; J = justice; T/R = technical rightness
S = self; C = company; OP = other person
CC = other company

TABLE A-4.--Tota1 summary--ethica1 content and quality

255

action choices.

of case problem

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

N: 73 28 101 14 16 33 16 22
Total Summary Total
Grp 1 Grp 2 Total Mfg Mktg Eng P&A A/F/S
Int-P/S 3.17 3.11 3.15 2.91 2.81 2.97 3.80 3.32
J/C .73 .79 .75 .61 .75 .79 .75 .77
J/OP 2.52 2.93 2.64 2.86 2.56 2.90 2.18 2.50
Ext-P/C 2.54 2.54 2.54 3.14 2.00 2.72 2.49 2.32
J/OP .04 .07 .05 .15 .13 -o- .07 -o-
J/OC 2.03 2.04 2.03 1.96 1.75 2.07 2.02 2.23_
T/R 3.26 3.00 3.22 2.99 2.88 3.47 2.76 3.36
Total P 5.71 5.65 5.69 6.05 4.81 5.69 6.29 5.64
Total J 5.32 5.83 5.47 5.58 5.19 5.76 5.02 5.50
T/P % 51.8 50.8 51.0 52.0 48.1 49.7 55.6 50.6
T/J % 48.2 49.2 49.0 48.0 51.9 50.3 44.4 49.4
N= 10 7 28 12 16 4 9 5 4 6
Group Group 2
Mfg Mktg ' Eng P&A A/F/S Mfg Mktg Eng P&A A/F/S
Int-P/S 2.89 2.57 3.00 3.90 3.38 3.25 3.00 2.80 3.50 3.17
J/C .77 .86 .82 .67 .56 .25 .67 .60 1.00 1.33
J/OP 2.80 2.57 2.84 1.99 2.19 3.00 2.56 3.20 2.75 3.33
Ext-P/C 3.20 2.43 2.63 2.57 2.00 3.00 1.67 3.20 2.25 3.17
J/OP .11 .14 -o- .09 -o- .25 .11 -o- -o- -o-
J/OC 1.92 1.71 2.05 2.02' 2.19 2.00 1.78 2.20 2.00 2.33
T/R 3.09 2.86 3.55 2.85 3.31 2.75 2.89 3.00 2.50 3.50
Total P 6.09 5.00 5.63 6.47 5.38 6.25 4.67 6.00 5.75 6.34
Total J 5.60 5.28 5.71 4.77 4.94 5.50 5.12 6.00 5.75 6.99
T/P % 52.1 48.6 49.6 57.6 52.1 53.2 47.7 50.0 50.0 47.6
T/J 8 47.9 51.4 50.4 42.4 47.9 46.8 52.3 50.0 50.0 52.4
TERMS: P = prudence; J 8 justice; T/R = technical rightness

S = self;

C - company;
CC = other company

OP

= other person

...3

AA-‘ ‘

Pi‘.“ :L‘L‘kfiu" ulIL‘-.-I¢‘. ‘3‘

APPENDIX B

DESCRIPTION AND HISTORY OF GROUP 2

.3?

.fl‘c‘f
.
_ n. .4...-

 

p

APPENDIX B

DESCRIPTION AND HISTORY OF GROUP 2

The survey managers who comprise Group 2 were

drawn from the membership of a religiously oriented orga-

. - r,‘ ‘
5 _ I‘

nization in the same large metropolitan area in which the

Group 1 respondents were found. The information about
these men which follows was taken entirely from a small
pamphlet issued by the international office of the orga-
nization. The pamphlet is titled, "CBMC--What It Is,
What It Does," and the international office of CBMCI,
Christian Business Men's Committee International, is
maintained in one of Chicago's suburbs. The metropolitan
area of Group 2 is not Chicago.

What is CBMC? CBMC is its members. And behind
every member there is a story . . . (three short
examples are given) . . . Three stories. Three men
who faced the claims of Christ, received Him as their
personal Saviour and found reality. And this is
CBMC. Men finding Christ--and then sharing this
reality with other businessmen. Multiply the three
stories by thousands and the scope and influence of
CBMC begins to jell. As an organization of Christian
businessmen, CBMC is not meant to be a social club.

It does not try to fill the role of a church.

Active in their respective churches, CBMCers
recognize a further need for this unique organization
to help them grapple with the problems that are common
to Christians seeking to live their faith in the
business world. Pastors express appreciation for
the maturing effect that CBMC has in the lives of their

 

256

257

members--men who are strengthened through the exercise
of their faith in the business world. There are many
ways that CBMC helps its members realize their role

in life, through prayer sessions, mealtime evangelism,
training sessions and national conventions--the
sharing of mutual problems and answers. . . .

What It Does. Encourages the Christian businessman
to make God a vital part of his vocational life.
Teaches how to share through conversation the reality
and love of God, the relief of forgiveness, the peace m
and the purpose that comes from genuinely relating to '1
Christ. Brings men together regularly for fellowship
in prayer, in the Word of God, and in personal sharing
of experience. Studies and develops contemporary
methods of exposing business friends to the plan of L
God through Jesus Christ. Encourages Christian busi-
ness men to support financially Christian activities, .;
as God has profited them. Publishes CBMC CONTACT, :J
CBMCI REPORT to provide news, special personal exper- L
ience testimonies of businessmen, and other challeng-
ing articles.

The CBMC Movement and Its Development. The first
CBMC started in 1930 in Chicago. It was intended to
spark men to their privilege and obligation to teach
and preach Jesus Christ by their lives and words
wherever they happened to be. Other cities formed
similar committees. In 1938 CBMC International was
incorporated.

Men from varied vocations and denominations have
seen CBMC as a plus effort in their lives, different
from the responsibilities they accept in their own
churches. Because of this response on the part of
Christian men in business, CBMCs have sprung up in
nearly 700 communities throughout 40 countries,
bringing 15,000 men into this international movement.

Annually delegates and visitors from all over the
world attend the CBMC International Convention.

Many regional conferences and retreats are held
throughout the year, to further interest and enlist
men in business to find the stability and satisfaction
that Jesus Christ can give.

CBMC Statement of Doctrine. 1. We believe in the
Scripture of the Old and'NewiTestaments as verbally
inspired by God, and inerrant in the original writings
and that they are of supreme and final authority in
faith and life. 2. We believe in one God, eternally
existing in three persons: Father, Son, and Holy
Spirit. 3. We believe that Jesus Christ was begotten
by the Holy Spirit, and born of the Virgin Mary and
is true God and true Man. 4. We believe that man was
created in the image of God; that he sinned, and
thereby incurred, not only physical death, but also

 

 

 

 

258

spiritual death which is separation from God; and that
all human beings are born with a sinful nature, and

in the case of those who reach moral responsibility
become sinners in thought, word and deed. 5. We
believe that the Lord Jesus Christ died for our sins
according to the scriptures, as a representative and
substitutionary sacrifice; and that all that believe
in Him are justified on the ground of His shed blood.
6. We believe in the resurrection of the crucified
body of our Lord, in his ascension into Heaven, and

in His present life there for us, as High Priest and
Advocate. 7. We believe in "that blessed hope,"

the personal, premillenial and imminent return of

our Lord and Saviour, Jesus Christ. 8. We believe 5
that all who receive, by faith, the Lord Jesus Christ V
are born again of the Holy Spirit and thereby become
children of God. 9. We believe in the bodily resur-
rection of the just and unjust, the everlasting L2
blessedness of the saved, and the everlasting conscious

punishment of the lost.

 

."'_-’J "'-

The first article of the above doctrinal statement
explains why the respondents of Group 2 rated, Own
Religious Beliefs, so much higher than the respondents
in Group 1. They are conscious of the authority of God,
made known to them in the scriptures, as being higher
than the authority of men.

The practical application of such beliefs is
sometimes recognized, as becomes evident in the following
excerpts from a statement by Andrew W. Hughes, Vice
President & Treasurer of Rheem Manufacturing Co., on the
occasion of the retirement of G. Tom Willey from the
Vice Presidency of Martin Company, one of the nation's
largest aerospace firms, in May 1967:

We of industry could, without exaggeration or

qualification, extol the massive contributions you
have made in the industrial areas of production,

efficiency, Zero Defects, manpower utilization,
development of people in peacetime and in war.

259

These are tremendous accomplishments. . . . You knew
your basics in business and were confident that they
could apply to most all industrial situations. How-
ever, in this respect you join perhaps hundreds of
others who could boast of duplicate records. You and
I know many of these men and women and some have
passed into retirement, soon to be forgotten--not
even their names easily remembered. However, Tom,
you have left a stamp of recognition on the American
industrial scene that will continue, because for
almost 40 years you have provided us an answer to
the questions that disturb every honest thinker.

Can religion and business mix? Is faith in God
reIated to one's daily occupation?

We of industry acknowledge with appreciation that
you have exhibited convictions for life, not just
for Sunday but seven days a week. . . . These hectic
days of tension, nationally and internationally,
demand a loud, clear call to the basic virtues and
rescources of the convictions for life which you have
demonstrated. . . . We've observed that you have a
right perspective, and I believe you have quoted it
from the Bible--the Book we have come to know as the
source of your convictions. The quotation is, "Seek
ye first the kingdom of God, and His righteousness,
and all these things shall be added unto you" (Matt.
6:33).

We of industry have noted that you didn't just
depend exclusively on education, training, friendship,
experience, influence, and other "tools" to accomplish
results, but you put God first regardless of the cost
and fully expected Him to provide answers and results.
We acknowledge He did. . . . Because of your perspec-
tive, purity of life, peaceableness, and purpose,
you have had something to say with an experience of
reality to illustrate and support your talk. Your
walk supports your talk. Thank you, Tom, for showing
us in American industry that faith in God is related
to our daily work and that we need conviction for life

 

 

 

 

 

in order to attain true, lasting success. . . .1
Mr. Willey is a past international chairman and a
continuing director of CBMCI. The monthly issue, Contact,
of this organization regularly carries the personal testi-

monies of many men at various levels in American business

 

lCBMC Contact, xxv, No. 7 (July, 1967), 14-15.

W 9‘...” H.O-HI yn-‘,9?

260

and industry, and elsewhere, as to the importance of
their religious beliefs in their daily lives, in and out
of business. Few are so publicly acknowledged. In
addition to the statements of activities quoted from the
pamphlet, CBMC members serve on the boards of, and con-
tribute financially to the support of rescue missions
for down-and-outers, youth groups such as VCY, after
school Bible clubs for youngsters, Bible institutes and

colleges, jail visitation-~wherever their spiritual out-

 

... .7.

reach can help someone in need of spiritual help.

APPENDIX C

DESCRIPTION OF THE PILOT STUDY

. 6,;

 

\—-_.

APPENDIX C

DESCRIPTION OF THE PILOT STUDY

After the original structure of the questionnaire

had been formulated, a pilot study was made using fifteen

WI“ vM-mm-ueo .flxmp

graduate students (doctoral) at the University who were
approximately evenly divided among the departments of
management, marketing, accounting and finance, and labor
and industrial relations. Ten of these had had some
industrial experience, three rather extensive. After
follow-up there were fourteen replies. Of these, two
declined, one had been out of the country and was received
too late, and one was incomplete. Thus, there were ten
usable replies.

Inasmuch as these test respondents were not, at
the time, employed in industry, they were not requested
to fill out Part I—-Persona1 Profile, or Part III--Environ-
mental Factors, but to merely review and evaluate the
questions and furnish written comments. They were asked
to rank the twenty Influences in Part II, to select appro-
priate action choices for the (then) seven case problems,

and to indicate which three influences they identified

261

262

most strongly with these case problems. A summary of
their responses and recommendations follows.

Part I--Personal Profile. Most respondents found

 

the questions in this section satisfactory. A few sug-

gested greater elaboration or clarification. As a result,

 

a scale was adopted for, Age _____; Ethnic Origin _____J F?
was divided into, Race _____, and Nationality _____; the I
question as to Religion._____, was changed to specify, . i
Denomination; more space was allowed to relieve crowding. I
L,

The adoption of these suggestions in the final form of
question resulted in an almost problemrfree response from
the industrial respondents. Only one area presented dif-
ficulty, in that some respondents stated, Protestant,

in answer to the question on religious denomination, for
which a category was therefore provided.

Part II--Influences. Many pilot respondents com-

 

plained that twenty were too many to rank, some were too
general, or too similar to others, and some had equal
importance. Two respondents suggested a scale. Accord-
ingly, the number of influences was reduced to eighteen,
and rather than ranking, a seven-point scale was adopted.
The final result was highly satisfactory. The eighteen
influences were identified, six each, in three categories--
authority-oriented, organization-oriented, and self-
oriented--and the scale weights, rather than the ranking
positions, were used to determine the strongest orientation

of the respondents as members of the groups, functional

263

areas, or organizational levels into which the final
sample was stratified.

The pilot respondents had gone through the process
of ranking the original twenty influences, with the fol-
lowing results:

Based on simply averaging the rank positions--in
total, the respondents ranked organization strongest
(lowest in average rank numbers, 1 thru 20), then self,
and authority last. With the marketing majors, the order
was self-authority-organization; the management majors,
organization-self-authority; the accounting majors, self-
organization-authority; the LIR majors, authority-
organization-self. There were, of course, variances as
to the individuals within these groups. By contrast,
their industrial counterparts in Group 1, in total, rank
them, authority-self-organization; and marketing was,
organization-authority-self; personnel was authority-self-
organization; accounting also was authority-self-organiza-
tion.

In the general ranking, the pilot group ranked
the first six influences: personal integrity, professional
competence, ethical standards, society's interests, peer
groups's attitude, and customer's interests. For the
case problems, the first six influences were: personal
integrity, company's economic interests, ethical standards,

professional competence, religious views, and customer's

 

WIT-‘4'?“

264

interests. To a smaller degree, this indicates that the
pilot group also differentiated between general and
specific applications.

Part III--Environmental Factors. The evaluations

 

were all favorable, with one or two suggestions to
clarify or be a bit more specific with the wording to

assure understanding. One respondent was concerned about

 

the confidentiality of questions on income, but anonymity
was assured, and in the study sample there was no reluc- L
tance to give any information.

The Case Problems. The pilot questionnaire

 

included seven problems, and a number of the respondents
complained about the time it took to complete the ques-
tionnaire. It is believed that tedium, rather than time,
may have been a factor. In any case, one of the cases
was eliminated. In the study sample only one case had a
refusal, the last, which the respondent stated was too
unrealistic to warrant an answer. (His comment was that
the government had never been so logical as to let con-
tracts on the basis of the lowest three bids.)

The rating technique had not been developed when
the pilot sample replies were reviewed, therefore, only
a simple comparison was made between the action choices
of these respondents. Four of the ten had selected only
one action for each problem, even though the instructions

said that one or more could be used in combination. This

 

265

was rarely the case in the industrial sample, and this
might indicate that the pilot test respondents had a
more restricted view of the solution possibilities for
each case, three of the four having had no industrial

experience at all. Within the limits of the ten responses,

 

there was evidence of a diversity of response patterns, 8
which became much more evident in the industrial study, 1
and became the basis for supporting two of the research
hypotheses.

Aside from the time factor, almost all respondents t

enjoyed the challenge of the case problems, although some
obviously had technical limitations.

Summary. The pilot study served a good purpose,
in that it provided for an objective criticism of the form
and structure of each part of the questionnaire, identi-
fied flaws and problems, and enabled restructuring which
resulted in a minimum of problems in the industrial sur-
vey. The single most serious problem resulted from the
fact that approximately 28 per cent of the respondents
misinterpreted the request to identify the three most sig-
nificant influences which they perceived as Operative in
each case problem. Some inserted the numbers of the
action choices in order of importance, and some simply did
not complete the requirement for all case problems. In a

future replication, this will be made more clear.

APPENDIX D

FINAL FORM OF THE QUESTIONNAIRE

. ‘55

 

a?
is}

APPENDIX D

FINAL FORM OF THE QUESTIONNAIRE

R .7?
.m" I“.

Copies of the final form of the questionnaire
(photographically reduced) are shown on the following

pages. These differ from the original which was used g

 

in the pilot test in that the Influences first were
twenty in number, and the respondent was asked to rank
them in order of their importance to him, from one to
twenty. The test and comments indicated that there was
difficulty in ranking the lower half, some items were of
a nature not readily comparable, and there were too

many. It was decided to reduce the number to eighteen,
and to have the respondent rate each influence individ-
ually on a seven-point scale. This proved much more
satisfactory. Many correspondents wished to give equal
weight to some influences, and the rating procedure made
this easily possible. Then the ratings were added up in
accordance with the three categories into which each
influence was placed—-authority, organization, or self-
orientation--and the totals were also used in the analysis
of the respondents by groups, functional areas, and orga-

nizational levels.

266

267

There were originally five case problems. TWo
more were added, but it became obvious that the com-
pletion took more time than the respondents were willing
to devote, therefore, one was eliminated. As can be seen,
three of the cases are worded in two ways, one set objec-

tively, the other subjectively. Half the respondents

. ‘v

received one mode, and half the other mode, in testing

 

for Hypothesis 1.

Twenty-eight per cent of the respondents misin-

‘_ Q.“ ’ ‘ U.“-
EQI s
"i- ___

terpreted the instructions to indicate which three of the
influences they had rated in Part II entered most into
their decision choices for the case problems. Some
inserted the action choice numbers, others ignored the
item-~which seemed to indicate that they thought it too
burdensome.

A number of respondents commented favorably on

the form and structure of the questionnaire.

 

 

 

268

MICHIGAN STATE UNIVERSITY - MANAGEMENT SURVEY QUESTIONNAIRE September 1970
To the Respondent:

You are respectfully and earnestly requested to cooperate in a special program of re.
search into the problems of managerial decision choices in the industrial context. This
program is beim conducted under the direction of the Department of Management, Graduate
School of Risiness, Michigan State University. by the undersigned doctoral candidate.

The increasing cuplsxity. interdependencies, era! accelerated pace of changes in the
industrial sector are asking rational decision choices progressively more difficult. Much 1;?
sore than purely economic considerations alert a strong influence. The purpose of this I 1
study is to identify sons of these variables .. chief of which are the “influences“ impact- ‘1
ing directly on the aamger - to aeasure their relative significance, detemine‘how they
inter-relate in the decision process and how they are perceived by the managers themselves.

As a member of your name has randoaly
been selected within one ’of five functional groups to be sampled in this study, and you are
urged to extend your cooperation in helping to further this important work. You will retain
caapletsly anonymous and your reply is to be mailed by you directly to the 160 Research Pro. " I
ject designated on the addressed stamped envelope provided herein. Your response will be H
mechanically compiled with others into a systematically structured stratigraphic pattern. - '
the segnents of which will then be analysed. Please answer all ouestions factually, real-
istically, and in terms of your actual perceptions. The aggregate of all responses will be-
co-e patterns and trends to be treated as variables for study. The Questionnaire consists of:

 

 

Pan - Personal Profile

Sons questions, such as on Religion, are so-swhat personal. but you will appreciate that
this inseparable dimension of the individual (under the “whole nan on the Job" concept) lust
be given due consideration, as wellss other similar characteristics, in understanding acre
clearly the aanager's fra- of reference and how he functions.
9. - W
This representative list of influences is not arrayed in am particular order. Rate
each one on its own scale according to its significance to you in your work as a somber of
management, and feel free to charge until you are satisfied.

- Wham
These also include confidential data which will be compiled only into 3332 character-
istics. Among the- are inportant factors which can profoundly affect the aanagerial de-
cision processes, whether consciously or subccmciously. ‘lhe research is designed to see
if there is a measurable correlation with various aspects of decision choices.

IV I- .

You will: ffi quite interesting these brief lupothetical cases (drawn from actual cc-
currences). There are no absolutely correct solutions. Justification night be found for
almost any pattern of answers. The intent here is to get your reaction as a member of a
particular functional group to see how each such group responds to the ease problen. You
should choose your answers fru along those suggested in the way that feels most natural
and appropriate to you.

Your cooperation in this research program is considered invaluable am! will be very
deeply appreciated. Capletim the questions and case problems should be a helpful exper.
ience and any give you a fresh perspective on aanagerial decision nakirg. Because of the
relatively small number of respoulents your participation is essential to the success of
this study. If you have aw questions or scents. write them on the reverse side of the
page in question. Return 1'31: entire Questionnaire, please (except this sheet) even if you
feel you cannot fully respoul in all areas. ease be as prompt as possible. since the
work of cupiling the data cannot couenoe until all return envelopes are received.

(If necessary you say reach as " i .
mt e I

R. J/Shds :- Ph.D Candidate)

 

269

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

£2. MLLM' MW in Limo- ran-5 in 1.4a
w 7 7
l. Cuparv Policies/Procedures[ L 10. Own Ethical Standards L 34) .J.

t 4
2. Top Hanag-snt Attitude .- 4r 4
3. Your Supervisor's Attitude 4.1). 4,
1:. Ccapany Semis Interests 4.1» 9 .
5. Your Peer Group's Attitude
6. Custeeer/Supplier Welfare 1
I
4
E
.4

7.
8o
9.

MICHIGAN STATE UNIVERSITY - MANAGWT SHELL-z; was'rmw SAMPLE cmup:____
m - Personal Prefile
1. Age (circle nearest): 20 25 3O 35 '40 145 50 55 6O 65 2. Sex: M___F___
3. Ethnic Origin: Race Nationality 1‘. Birthplace:
5. “Hone” State 6. Marital Status 7. No. of Children
8. Military Service: (a) Years______ (b) Rank (c) Combat? Yes No
9. Education: (a) Years: n.s._____ c611m_ (b) Degrees (c) 14.36:-
10. Religion: (a) Denaination (b) Conservative___ Hoderste__ Liberal—
(c) How important is your religion to you? (Check Scale) HIGH. 7. 6' 5. h' 3. 2. 1. 0.101
11. tie-ber of Fraternal Order? Yes____ No 12. lie-ber of Professional Group? Yes__ No—
13. Father's: (a) Education (b) Vocation (c) Religion
lb. Mother's: (a) Education (b) Vocation (c) Religion
15. What are your three lost inpertant Activities/Interests/Goals in Life (in rank order):
(a)
(b)
(c)
16. Have you studied (check): (a) Religicn__ (b) Ethics___ (c) Logic__ (d) Psychology—
m - Wm

Listed below are a representative nuaber of “influences“ which nay affect one's perception
and decisions about work problem. Rate each one on its scale in accordance with its degree
of significance to you as a manager or supervisor. fru 1 for High to 1 for Le: significance.

Wife's/Penny's Attitudes
Own Econuic Interests

11. Own ibligious Beliefs
12.

T
l

legal Constraints
13. Conpamr's bmtation
14.

r

Subordinates ' Attitude

 

 

15. Society's Interests ,-

A

1

A
v

 

 

 

Own Professional Competence (ma

 

 

 

 

16.
17.
18.

Fear of losing Job
Osn Personal Integrity

 

Own Career Aspirations.

Y
I

L

Li

w—f— ** "1%... 1.

a‘
Y'fi

... 1.4-..t.._._+.
. I

 

- --e—- -+--e--—++—-—o—-—e ._

A

7654321

(Continue to Part III)

I __¢.. _.—.~..

6
. -—+-—--.-e

I

e l 4

i T
_T'--""-"“'.

. I

 

MICHIGAN STATE UNIVERSITY - MANAGE-TENT SURVEY QUESTIONNAIST. SAMFIE GROUP:

270

Pea III - Emrimnmeml Fagtgn

1.

2.

3.

5.

6.

7.

8.
9.

105

11.

12.

13.

Genenl Functional Area in which you work: (check one) (s) Manufacturi m:

(b) Mar-keting (c) Emineering (d) Personnel .9 Administration

(e) Accounting, Finance, Systems

Your Sgcgic Functional Area (Purchasing, Cost Accounting, Training, etc.) (Do 1191':

give your title):

 

Your Organisational Level (seeming President is let level):

 

Approx. no. of subordinates reporting to you: (a) Directly (b) Indirectly

 

No. of employees in your Division (circle nearest): 100 500 1000 5000 104 Here
Your approx. annual esrnims (circle nearest): $10M $15M $20M $25M $30!! More
Do you own, or are you a major investor in, your compary? (a) Yes (b) No

Number of Years you have been: (a) With Company (b) In Present Position

 

How do you feel your relationships are with your:

(a) Superiors: Very Good Good Fair Poor
(b) Peers: Very Good Good Fair Poor
(c) Subordinates: Very Good Good Fair Poor

What do you think are the attitudes toward ethical problems, of your:

 

 

(a) Cap-rm Positive Uncertain Indifferent
(b) Superiors : Positive Uncertain Indifferent
(c ) Poers : Positive Uncertain Indifferent

(d) Subordinates Positive Uncertain Indifferent

How do you see your own situation in the Cmpamr:

 

 

 

 

 

 

 

 

 

 

(a) Position Secure? Yes Uncertain No
(b) Advancement Possible? Yes Uncertain No
(c) Salary Equitable? Yes Uncertain No
(d) Do You Like Your Work? Yes Uncertain No
(e) Like the Environment? Yes Uncertain No

what do you third: are your Capaw's Three lager Goals or Objectives (rank order)?
(a)
(b)
(o)
Are the ethics of businessman in general: Improving—WorsenimL—Not Charging___

‘f

'3

0 any“? -"-___ I.

 

2'71

MICHIGAN STATE UNIVERSITY - MANAGEMENT SURVEY QUESTIONNAIRE SAMPIL GROUP:

PART IV - CASE PROBLEMS INVOLVING ETHICAL CONSIDERATIONS

Read through each case, then decide which of the gpg_gg_more actions are most
appropriate for each - circle each of the numbers chosen.

Case

Out of town firm supplies your company with new component, unit value $5. each.
The B/P, Specs and P.0. show critical dimension of 3.0010. First delivery of 200 units
is invoiced at $1000. Q.C. finds 50 units undersise by up to .0005 and not repairable,
sets them aside for return, and notifies the Buyer. He phones supplier who promises
prompt replacement and requests the rejects be scrapped here to save cost of return.
Ilsediately aftemrd (1) Production finds that such a close tolerance (3.0010) is not
really needed, (2) Engineering agrees that the tolerance could be $.0015.

Which (one or more) of the following actions do you recommend:

1. Debit supplier $250. for the rejects:

2. Scrap the rejected parts:

3. Advise supplier the rejects have been accepted;

4. Do nothing:

5. Request Engineering issue B/P and Spec revisions:

6. Request Purchasing send supplier new B/P, Specs, and P.C. revision:
7. Request Q.C. to accept the rejected parts for use in production;

8. Any other (briefly)

 

Which three of the 'Influences' you ranked in Part II entered most strongly into
your decision? Strongest, 0 Next, I Third Strongest, #

 

Case
fit Center D is currently working on four programs. The current month-end
Performance Report submitted for Profit Center Manager's review shows the following:

 

 

(3000's) Planned Cost Budget F'cast To Est. Cost Projected
cat *0 Eat: gelance on lots at Completion Variance
Program {1 g 180 150 30 37 3 187 3 Z 75
R 110 90 20 23 113 ( 3)
#3 250 160 90 115 275 ‘(25)
a 26.9 119 122 11.0. 44.0. _20
Total 4 800 8 530 3 270 3 285 $ 815 $ (15)

‘Original estimate 810,000. too low: costs to date held very close; all foreman agree
forecast is as tight as possible: projected cost overrun appears inevitable.

Consider an average Financial Analyst reporting to the Profit Center Manager. His
staff compiles the data and prepares the report, which the P.C. Manager reviews, signs,
and submits to the General Manager. The P.C. Manager does not want to submit such a
bed report for Program #3. Re states the data may be inaccurate and suggests that a
"temporary adjustment" of 815,000. in forecasts between Programs 3 and h "for just this
report“ would forestall higher level inquiry and give him time to ”try to work things
out.“ He is responsible for explaining the variances. The Financial Analyst reluctantly
complies on the basis that the P.C. Manager still has control over what has not yet
happened. The following month's report shows that things have not improved, but have
gotten worse. The P.C. Manager fumes and again suggests that the Financial Analyst
'bdjust the forecast.“

Which (one or more) of the following actione,in your opinion,would the average
Financial Analyst take?

1. Again comply:
2. Refuse to comply:
3. Delay action:
1:. Discuss the problem with the foremen;
(continued next page)

 

V” 7‘

272

5. Privately call the Company Controller:
6. Ask Personnel for a transfer:
7. Resign:
8. Other (briefly)

 

Which three of the "Influences" you ranked in Part 11 entered most strongly into
your opinion? Strongest, 0 Next, i Third Strongest, 0

Case 12

Consider an average Senior Buyer. One of his junior buyers rates an overdue
salary increase but things are tight and there is no allowance for this in the depart-
mental budget for at least 6 months. The Junior has unexpected financial problems, is
discouraged, unhappy, and talks of leaving. Neither Personnel nor the Senior's superior
has any suggestions. The Senior Buyer has reason to believe a new suprlier the Junior
handles may be "getting too friendly‘ with him, knowing his circumstances.

Wish (one or more) of the following actions, in your opinion, would the average
Senior Buyer take?

1. Do nothing:
2. Tell the Junior Buyer the budget situation and promise action in 6 months:
3. Whit to see what happens:

h. Wern the Junior not to get involved with the Supplier:

5. Talk to the Supplier:

6. Offer to loan the Junior money:

7. Insist his superior request a budget adjustment:

8. Other (briefly)

 

Which three of the "Influences” you ranked in Part II entered most strongly into
your opinion? Strongest, 4 Next, O Third Strongest, O

Case
onsider an average Manufacturing Manager. The Sales Manager (who seems likely

to be the next General Manager) has befriended one of the buyers of a major account to
which 3 types of special fabricated components are sold under blanket P.C.s with monthly
but somewhat flexible delivery schedules. (The Sales Manager has sent flowers to the
buyer's sick wife, bought toys for his children, etc.) Production is programmed for
early delivery of each month's schedule plus holding a 50% reserve against next month.
volume has been dropping. This month the Sales Manager requests the 50% reserve be
increased to 100‘ and the 3 components shipped h weeks, 3 weeks, and 2 weeks early,
stating a revised release is coming. Instead, the customer's buyer calls the Produc-
tion Control Office to complain about the first early shipment. Re is told that the
Sales Manager made the arrangement. The buyer subsides, saying he only agreed to a
50‘ advance on one item to “relieve ur inventory problem." A week later he franti-
cally calls again, requesting that shipments be stopped.

hhich (one or more) of the following action; in your opinion, would the average
Manufacturing Manager take?

1. Ignore the buyer:

2. Confront the Sales Manager for an explanation:

3. Revert to authorised scheduled releases:

b. Request that the Sales Manager obtain the revised releases.
5. Take the matter up with the General Manager:

6. Request that billing be delayed on the advance shipments:
7. Authorise return of the advance shipments:

8. Other (briefly)

 

Which three of the I‘Influences" you ranked in Part II entered most strongly into
your opinion? Strongest, # Next, I Third Strongest, 0

 

2'73

Case

The Engineering Supervisor had been recently promoted to Project Manager and had
achieved accession to the Executive level, which meant, among other things, that he shared
in the annual executive bonus, was entitled to lease two cars, etc. A few months later
his supervisor handed him a slip on which was pencilled the amount $65, and the name of a
central office executive. "This," he said, "is your political contribution for this year.
Make out your check to the party of your choice, put it in an envelope addressed to Mr.
(the central office executive) and give it to me to forward.”

Which of the following(one or more)express your feelings best?

A. This requirement $3.923 unethical because:
1. Executive level personnel should have a sense of social responsibility
and support our democratic political system.
2. It takes a little pressure to induce one to make a political contribution.
3. If political parties are not financially supported our democratic system
may fail.
h. The executive has free choice as to which party he can support.

B. This requirement ig_ggethical because:

5. The executive is being required to make a political contribution whether
he wants to or not.

6. The amount of his contribution is being stipulated: he has no choice as
to how much.

7. The Company uses this device to evade the Federal laws prohibiting
political contributions by business corporations.

8. The executive can be ”rated“ by higher management according to which
party they can see he supports.

r613“. I’ .‘Me I‘l‘.‘ mm 23“:
\‘. Q ‘ ‘l
M: £7--. _

Which three of the "Influences“ you ranked in Part II entered most strongly into
your opinion? Strongest, 4 Next, ' Third Strongest, §

Case E

e government is considered by many to be a "price buyer", and in the case of many
requirements such as defense, space, atomic development, etc., is the ultimate "only“
customer. Thus, the government's bargainino position is generally deemed to be stronger
than that of any supplier unless the supplier has a proprietary item (or service) for
which there is no acceptable substitute and is therefore a ”sole source."

Consider a situation where there are many suppliers and the government buys an
electro-mechanical assembly periodically in lots such that the available requirements are
divided among the three lowest bidders under a Fixed Price arrangement. Because business
is generally falling off more suppliers come in, competition is keener, and the price
keeps dropping as each new periodic bidding opportunity is opened. In fact, some bidders
stay in only to try to get volume to help absorb fixed overhead.

mich of the following (one or more) express your feelings best?

A. The government's buying policy 13 222 unethical because:
1. They must buy at the lowest possible price in the interest of the taxpayer.
2. No supplier (in this case) is forced to participate by making his capacity
available.
3. Suppliers should not expect to make much profit at the taxpayers' expense.
h. This is the only'wey businesses can operate in a free economic system.

B. The government's buying policy ig_ggethical because:
5. The buyer is unmercifully using whipsawing tactics to force the price
below a profitable level.
6. Suppliers require a reasonable profit to remain healthy and grow, (an
accepted principle in commercial industry).
7. The employees of such suppliers are denied opobrtunities for advancement
and normal wage increases.
8. The suppliers may be forced into price collusion practices in order to survive.

Which three of the "Influences“ you ranked in Part II entered most strongly into
your opinion? Strongest, I Next, 0 Third Strongest, i

2'74

MICHIGAN STATE UNIVERSITY - MANAGEMENT SURVEY QUESTIONNAIRE SAFiLi GHUFI:

PART IV - CASE PROBLEMS INVOLMING ETHICAL CONSIDERATIONS

Read through each case, then decide which of the 222 2: more actions are most
appropriate for each - circle each of the numbers chosen.

Case ’1

Out of town firm supplies your company with new component, unit value $5. each.
The B/P, Specs and P.0. show critical dimension of 2.0010. First delivery of 200 units
is invoiced at $1000. Q.C. finds 50 units undersise by up to .0005 and not repairable,
sets them aside for return, and notifies the Buyer. He phones supplier who promises
prompt replacement and requests the rejects be scrapped here to save cost of return.
Imediately afterward (1) Production finds that such a close tolerance (2.0010) is not
really needed, (2) Engineering agrees that the tolerance could be 2.0015.

Which (one or more) of the following actions do you recommend:

a" ‘3‘Lkw m- “If?

1. Debit supplier $250. for the rejects:

2. Scrap the rejected parts:

3. Advise supplier the rejects have been accepted:

h. Do nothing:

5. Request Engineering issue B/P and Spec revisions:

6. Request Purchasing send supplier new B/P, Specs, and P.C. revision:
7. Request Q.C. to accept the rejected parts for use in production:

8. 'Any other (briefly)

flhich three of the ”Influences“ you ranked in Part II entered most strongly into
your'decision? Strongest, O Next, O' Third Strongest, #

WI“ sun— .5.
fins.- _

 

‘Ebfit Center D is currently working on four programs. The current month-end
Performance Report submitted for Profit Center Menager's review shows the following:

(sooo's) Planned Cost Budget Want To Est. Cost Projected
Cost to lance C le at Com ls o ariance
Pros!!! l1 3 150 i 150 5 30 37 5 i3? ¥ ( 7)
n no 90 20 23 113 ( 3)
93 250 160 90 115 275 *(25)
It» 3.6.2 29. m .1_1_9 2.19 _20
Total 3 800 3 530 3 270 3 285 3 815 3 (15)

."Original estimate 810,000. too low: costs to date held very close: all foremen agree
forecast is as tight as possible: projected cost overrun appears inevitable.

Iou are linancial Analyst reporting to the Profit Center Manager. Your staff
compiles the data and prepares the report, which the P.C. Manager reviews, signs, and
submits to the General Manager. The P.C. Manager does not want to submit such a bad
report for Program #3. He states the data may be inaccurate and suggests that a
"temporary'adjustment' of $15,000. in forecasts between Programs 3 and h "for just this
report“ would forestall higher level inquiry and give him time to ”try to work things
out." He is responsible for explaining the variances. Iou reluctantly comply, on the
basis that the P.C. Manager still has control over what has not yet happened. The
following month's report shows that things have not improved, but have gotten worse.
The P.C. Manager fines and again suggests that you "adjust the forecast."

which (one or more) of the following actions would you take?

1. Again comply:

2. Refuse to comply:

3. Delay action:

h. Discuss the problem with the foreman:

(continued next page)

2775

5. Privately call the company Controller;
6. Ask Personnel for a transfer;
7. Resign:
8. Other (briefly)‘

Which three of the “Influences” you ranked in Part II entered most strongly into
your decision? Strongest, I lext, O Third Strongest, 0

Case L2

ou are the Senior Buyer. One of your junior buyers rates an overdue salary
increase but things are tight and there is no allowance for this in the departmental
budget for at least 6 months. The Junior has unexpected financial problems, is dis-
couraged, unhappy, and talks of leaving. Neither Personnel nor your superior has any
suggestions. You have reason to believe a new supplier the Junior handles may be
”getting too friendly“ with him, knowing his circumstances.

which (one or more) of the following actions would you take?

1. Do nothing;
2. Tell the Junior Buyer the budget situation and promise action in 6 months;
3. whit to see what happens;

h. Warn the Junior not to get involved with the Sipplier;

5. Thlk to the Supplier;

6. Offer to loan the Junior money;

7. Insist your superior request a budget adjust-eat;

8. Other (briefly)

 

Which three of the ”Influences" you ranked in Port II entered most strongly into
your decision? Strongest. # Next, I Third Strongest, O

 

Case ‘i

cu are the Manufacturing Manager. The Sales Manager (who seems likely to be the
next General Manager) has befriended one of the buyers of a major account to which 3
types of special fabricated components are sold under blanket P .O.s with monthly but

somewhat flexible delivery-schedules. (The Sales Manager has sent flowers to the buyer's

sick wife, bought toys for his children, etc.) Production is programmed for early

delivery of each month's schedule plus holding a 50$ reserve against next month. volume

has been dropping. This month the Sales Manager requests the 50% reserve be increased
to 100‘ and the 3 components shipped h weeks, 3 weeks, and 2 weeks early, stating a

revised release is coming. Instead, the buyer calls your Production Control office to.

complain about the first early shipment. Re is told that the Sales Manager made the

arrangement. The buyer subsides, saying he only agreed to a 50% advance on one item to

”relieve zpur inventory problem." a week later he frantically calls again, requesting
that ship-ents be stopped.
Which (one or more) of the following actions would you take?

1. Ignore the buyer;

2. Confront the Sales Manager for an explanation;

3. Revert to authorised scheduled releases;

h. Request that the Sales Manager obtain the revised releases;
5. Take the matter up with the General Manager:

6. Request that billing be delayed on the advance shipments;
7. Authorize return of the advance shipments;

8. Other (briefly)

 

which three of the “Influences” you ranked in Part II entered most strongly into
your decision? Strongest, I Next, O Third Stronzost. i_____

PM: A, .- 'NL a.” 3m m.e-.q7

m5?

APPENDIX E

STATISTICAL PROCEDURES

 

 

APPENDIX E

STATISTICAL PROCEDURES

. m 33'

The nature of the data derived from the survey

responses was such that the non-parametric techniques for

testing the level of significance were used throughout.

‘. -.

Two such tests were used in this study--the Chi-Square
test for g independent samples, and the contingency coef-
ficient test. The computer program was such that these
(and other) tests were included, and the print-outs of the
tabulations provided the statistical readings also.

The X2 test for E independent samples enables data
to be examined for significance which are inherently only
classificatory (nominal) or in ranks (ordinal). In apply-
ing the test the frequencies are first arranged in a
5 x r table. The null hypothesis is that the sample fre-
quencies have come from the same or identical populations
and is tested by applying the formula (shown on Figure E.l,
following). In this formula Oij = observed number of
cases categorized in the ith row of ith column, and Eij =

number of cases expected under HO to be categorized in

the ith row of 1th column. The summation signs direct

276

277

 

 

 

 

 

Interests . . .

Areas Family Work Religion Other Totals
MFG Expected 3.00 2.86 3.71 2.43 12
Observed 3.00 4.00 3.00 2.00
MKTG Expected 6.80 6.43 8.12 5.46 27
Observed 5.00 6.00 9.00 7.00
ENG Expected 3.75 3.57 4.64 3.04 15
Observed 3.00 3.00 6.00 3.00
P&A Expected 3.00 2.86 3.71 2.43 12
Observed 4.00 3.00 3.00 2.00
A/F/S Expected 4.50 4.27 5.57 3.64 18
Observed 6.00 4.00 5.00 3.00
Totals 21 20 26 17 84

Formula:

2

r k (0.. - E..)

X2 = E Z 13E i3

i=1 j=l ij
.00 .45 .14 .07
.48 .03 .10 .43
.15 .09 .40 .00
.33 .01 .14 .07
.50 .02 .06 .11

Chi Square = 1.55 + .60 + .84 + .68 = 3.67

df = 12; p g .989, H0 is rejected.

 

Figure E.l.--Examp1e of Chi-Square test for k
independent samples.

278

one to sum over all the cells. Under HO the sampling
distribution of X2 as computed from the given formula can
be shown to be approximated by a chi-square distribution
with df = (k - l)(£ - l), where k = the number of columns
and r = the number of rows. The probability associated

with the occurrence of values as large as an observed X2

9‘: In"

can be found in standard tables of the percentage points

of the X2 distribution (at the back of most texts on

statistics). If an observed value of X2 is equal to or

‘Jn .

larger than that given in the tables for a particular
level of significance and for df = (k -l)(£ -1), then Ho
may be rejected at that level of significance.1 Figure
E.l shows an example of the calculations.

The contingencycoefficient Q is a measure of the
extent of association or relation between two sets of
attributes and is useful when only categorical (nominal
scale) information about one or both sets of attributes
is available. The contingency coefficient, as computed
from a contingency table, will have the same value re-
gardless of how the categories are arranged in the rows
and columns. To compute the contingency coefficient be-
tween scores on two sets of categories the frequencies
are first arranged in a contingency table (similar to
that shown in Figure E.l). (The expected frequencies are
calculated in the same manner as for the X2 test.) The

larger is the discrepancy between the expected values and

the observed cell values, the larger is the degree of

279

association between the variables, and thus the higher is
the value of g. The degree of association may be found

from a contingency table of the frequencies by

_x_2_
N‘|"X2

. 6"

where X2 is computed by the method presented earlier.
Briefly, to compute 9, one first computes the value of X2

and then inserts that value into the above formula to get

reams-rm UM meme-a. ‘a‘--‘fv
. r .
b—‘a I ,

g. In testing the significance of a measure of associ-
ation, we are testing the null hypothesis that there is
29 correlation in the population-~that the observed value
of the measure of association in the sample could have
arisen by chance in a random sample from the p0pulation in
which the two variables were not correlated. In computing
the value of Q a statistic is computed which itself pro-
vides a simple and adequate indication of the signifi-
cance of 9, this being X2. We may test whether an ob-
served value of g differs significantly from chance simply
by determining whether the X2 for the data is significant.
Referring to a standard table of the percentage points of
the X2 distribution, if that probability is equal to or
less than the "alpha" level--.05, .001, or whatever--the

null hypothesis is rejected.2

 

lSidney Siegel, Nonparametric Statistics for the
Behavioral Sciences (New York: McGraw-Hill Book Company,
1956). pp. 174-75.

21bid., pp. 196-99.

 

APPENDIX F

DETAIL OF CASE PROBLEM ACTION

CHOICES BEFORE CONSOLIDATION

280

 

 

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