Chapter 3 Deciding What’s Right: a psychological Approach Contents



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Chapter 3
Deciding What’s Right: A Psychological Approach
Contents: (Please note: the Instructor Guide for every chapter will follow this structure.)

  1. Chapter Outline

  2. Teaching Notes

  3. In-Class Exercises

  4. Homework Assignments

  5. Additional Resources



Chapter Outline


  1. Introduction




  1. Ethical Awareness and Ethical Judgment




  1. Individual Differences, Ethical Judgment, and Ethical Behavior

  1. Ethical Decision-Making Style

  2. Cognitive Moral Development

    1. Level 1: Preconventional

    2. Level 2: Conventional

    3. Level 3: Postconventional

    4. Are Men and Women Different?

    5. Looking Up and Looking Around

    6. Autonomous Principled Thinking and Action

  3. Locus of Control

    1. Relationship to Ethical Judgment and Action

  4. Machiavellianism

  5. Moral Disengagement




  1. Facilitators of and Barriers to Good Ethical Judgment




  1. Thinking about Fact Gathering

  2. Thinking about Consequences

    1. Reduced Number of Consequences

    2. Consequences for Self vs. Consequences for Others

    3. Consequences as Risk

    4. Consequences over Time: Escalation of Commitment

  3. Thinking about Integrity

  4. Thinking about Your Gut

    1. Your Gut – “Automatic” Ethical Decision Making

  5. Unconscious Biases

  6. Emotions in Ethical Decision Making




  1. Toward Ethical Decision Making




  1. Revisiting the Pinto Fires Case: Script Processing and Cost-Benefit Analysis

    1. Script Processing

  2. Cost-Benefit Analysis




  1. Conclusion




  1. Exercise: Understanding Cognitive Moral Development




  1. Discussion Questions


Teaching Notes – Discussion Questions


  1. Steven F. Goldstone, Chairman and CEO of RJR Nabisco (one of four biggest U.S. cigarette manufacturers), said in a magazine interview, “I have no moral view of this business. . . I viewed it as a legal business. You shouldn’t be drawing a moral judgment about a business our country says is perfectly legal and is taxed like crazy by it.” (Might need to be sourced.) Think about Goldstone’s statement in terms of moral awareness. What might happen, if he began thinking about his business in moral and not just legal terms?


Possible Answer
The leaders of the tobacco companies have worked hard to keep from thinking about their companies’ product in moral terms. If they do not think about it in moral terms, they do not have to engage moral judgment processes. When forced by others to think in moral terms, they tend to talk about individual choice -- the individual adult’s right to smoke in a free country. They ran into serious problems with the public and the government, however, when it became apparent that they were aiming advertising at teenagers.
As was discussed in Chapter 1, this strict focus on the law is unacceptable. The law simply does not cover all ethical and social responsibility expectations of corporations. Companies that wish to stay out of trouble need to think beyond the law. They need to keep their fingers on the pulse of society. The disclosure rule can be helpful here. How would a particular practice play on the front page of the New York Times?


  1. Evaluate yourself in terms of cognitive moral development and locus of control. What does this tell you about your own ethical decision making? Do the same for someone you know well.

It is actually difficult for people to accurately evaluate themselves or others on cognitive moral development, with the small amount of information provided in the chapter. Information about obtaining a measure of cognitive moral development is provided below. But, this question does provide an opportunity for thought and self-reflection. A measure of locus of control is provided below.


Probes to Stimulate Discussion


  • “What do you think about, when faced with an ethical dilemma: whether you will be caught and punished? What significant others would think and do in the same situation? Or, what kind of world it would be, if everyone took a particular action?” (Most of our MBAs generally acknowledge that they and those they have worked with are at the conventional level of cognitive moral development.)




  1. Can you think of a time when you have used morally disengaged thinking?

It should be easy for students to think of times, when they have heard others use morally disengaged thinking.


Before teaching about moral disengagement, it can be revealing to give students examples of situations (see three examples below) and ask them how they are likely to act in them. Then, ask them to list the reasons why one might, or might not, do these things. Many of the reasons they generate for doing them, will match the moral disengagement mechanisms. The following examples would probably work best with undergraduates.


  • You work in a fast-food restaurant. It is against policy to eat food without paying for it. You came straight from classes and are therefore hungry. Your supervisor is not around, so you make something for yourself and eat it without paying.




  • Your accounting course requires you to purchase a software package that sells for $50. Your friend, who is also in the class, has already bought the software and offers to lend it to you. You take it and load it onto your computer.




  • You are preparing for the final exam in a class, where the professor uses the same exam in both sections. Some of your friends somehow get a copy of the exam after the first section. They are now trying to memorize the right answers. You do not look at the exam, but just ask them what topics you should focus your studying on.




  1. Identify a situation in which you have used script processing in a work or other life situation.

Most students find it difficult to really “get” this notion of scripts. So, it is helpful to discuss examples from real work settings. Be sure to emphasize that scripts only apply in “routine” situations. Think of them as “standard operating procedures” that one learns to use in these routine situations. For example, the triage system emergency room personnel use can be thought of as a script for deciding which patients get attention first, second, and so on.




  1. Do you believe that scripts can override an individual’s values system?


Possible Answer

Obviously, this question asks for an opinion. But, the truth is that they can. And, Denny's personal reflections provide a great example of this. Denny had strong values and beliefs related to business' responsibility to society. And he probably believed that he was being true to those values and beliefs. But, he needed some set of guidelines for making the tough decisions of a recall coordinator. These had evolved in the context of the corporate decision environment and the scripted guidelines excluded ethical considerations. This issue hints at something discussed in Chapter 7 - multiple ethical selves.


It may also be important to note that Denny was quite young, when he was given this responsibility. But, he also did not make recall decisions alone. He was part of a group that made “recommendations” to a higher level management group that would decide on the recall. So, the script became an important guide for decision making for the entire group.
Probe to Stimulate Discussion



6. Answer the question posed in Gioia’s Reflections: Is a person behaving unethically, if the situation was not even construed in ethical terms – if there was no moral awareness?
Probes to Stimulate Discussion


  • “Is it appropriate to say, ‘I hadn't thought of this in terms of right and wrong   I employed a structured way of thinking about the situation and that's why I missed the ethical overtones?’ "

Sure, it helps to understand one’s behavior, but it does not necessarily excuse it. The action was still unethical. Obviously, Denny does not think now that he did the right thing, although he seems to understand why he behaved the way he did.




  • “How autonomous can we expect people in organizations (ourselves) to be? “




  • “Whose responsibility is it to decide that a situation involves ethical concerns?”

Here is the relevant quote from Denny's personal reflections in the text:


The recall coordinator's job was serious business. The scripts associated with it influenced me more than I influenced [it]. Before I went to Ford, I would have argued strongly that Ford had an ethical obligation to recall.
After I left Ford, I now argue and teach that Ford had an ethical obligation to recall. But, while I was there, I perceived no obligation to recall and I remember no strong ethical overtones to the case whatsoever. It was a very straightforward decision, driven by dominant scripts for the time, place, and context.
(An overhead with this quote on it can stimulate a lengthy discussion).
7. Who should make the decision about taking risks with others' lives in designing products?
Possible Answers
Engineers, marketing people, top managers, government regulators, consumers? This is an important question about responsibility in organizations and is related to topics treated later in the book   chapters 7 and 9. When responsibility is diffused among a variety of people, there is more of a tendency to ignore the potential harm that a product might cause, unless organizational decision making systems are explicitly designed with this concern in mind. So, one way to deal with this is to consider ways to get every individual, who makes decisions related to new products, to consider their potential harm; n other words, to embed risk assessment into the decision making process, similar to environmental impact statements that are becoming a regular part of corporate reports. Ultimately, someone high in the organization must make the final decision. But, if information about risk and potential harm is included in reports provided to top decision makers, they are less likely to ignore or downplay these problems. It is also important that these decision makers be aware of the biases that affect the way they are likely to think about risk. They should design risk analysis into decision making processes and ask questions like, what is the worst-case scenario? Another consideration is to have the people making the product release decision be different from those, who are already highly invested in the product's success. They are likely to be more objective in their decision making.
This is also an appropriate time to consider again the role of government regulation. Arguably, government safety standards have evolved, because businesses did not create standards, stringent enough to satisfy the public interest. But, in the Pinto Fires case, the car met all safety regulations in effect at the time.
Students’ attitudes toward government regulation often differ, depending upon the role they take -- businessperson or consumer. It can be effective to have students take these different roles in the discussion.
8. Should a person be permitted to place a value on a human life? Should a company? Should the government? If not, how would decisions be made about whether to market certain products (that might be risky for some, but helpful for others), how much those who have lost family members in disasters should be compensated, and so on?
Possible Answers
Again, there are more questions than answers. The question is designed to get students thinking and we have had many lively discussions around the issues raised by this question. Some students are inclined to answer this question with a simple "no." But, it is not that easy. As a society, we make decisions about the risk we are willing to take with human life all the time. Certain medical procedures and medications have the risk of serious harm or death attached to them. Traveling in automobiles, trains and airplanes does kill people. We could build cars to protect us better in car accidents and fewer people would die, but we do not, because of cost and competitiveness issues. In some cases, people decide to give one life more value than another, as when a fetus is aborted to save the life of the mother, or one person is selected over another to receive an organ transplant. So, we do make these decisions. How do we do it? Is it better to use a moral reasoning approach, or some intuitive or "gut" approach than to place a dollar value on human life? Do the approaches presented in Chapter 4 help? Perhaps the most important question is -- who should be making these decisions?
9. How do you feel about the use of cost/benefit analysis, where human life is part of the cost calculation? Might the infusion of moral language have changed the decision makers’ thinking? For example, what if decision makers had talked about their responsibility for killing 180 human beings?
Possible Answers
This is a question about how students "feel" and is designed to provoke thought and discussion. An argument for using cost benefit analysis might be that dollars and cents are simply the ways we place value on things in this society. So, why not human life? It forces us to think about what human life is really worth to us. However, an argument against it might be that the value of a human life simply cannot be captured by such a crude measure. It is like trying to measure love in dollars and cents. If adults tried to do a dollar based, cost benefit analysis on the decision to have children, they probably never would. Although there are many benefits, they cannot be captured by a dollar figure.
It is clearly harder to make a decision to “kill” people. For that reason, it may be very appropriate to use this kind of language. At least we would be morally aware and we would be making our decisions with our eyes wide open.
Probes to Stimulate Discussion


  • "If we do not use some form of cost benefit analysis, what do we use?"


10. Given that all automobiles are unsafe to some degree, where do you draw the line on product safety? How safe is safe enough – and who decides?
Possible Answers
Students have difficulty with this one. But, again, it makes them think about the complexity of these issues, and they usually acknowledge the importance of product safety regulation to protect consumers.
Probes to Stimulate Discussion


  • “How many of you drive Volvos? If not, why not?” (Volvos are thought to be among the safest cars on the road, but one does not see many.)


In-Class Exercises
Exercise #1: Another Short Case for Discussion

Mary, the director of nursing at a regional blood bank, is concerned about the declining number of blood donors. It is May, and Mary knows that the approaching summer will mean increased demand for blood and decreased supplies, especially of rare blood types. She is therefore excited, when a large corporation offers to host a series of blood drives at all of its locations, beginning at corporate headquarters. Soon after Mary and her staff arrive at the corporate site, Mary hears a disturbance. Apparently, a nurse named Peggy was drawing blood from a male donor with a very rare blood type, when the donor fondled her breast. Peggy jumped back and began to cry. Joe, a male colleague, sprang to Peggy’s defense and told the male donor to leave the premises. To Mary’s horror, the male donor was a senior manager with the corporation. What is the ethical dilemma in this case, and what values are in conflict? How should Mary deal with Peggy, Joe, the donor, and other representatives of the corporation?
The values in conflict are Peggy’s right to be treated with dignity and respect, and the rights of those, who will need blood in the coming months. If Mary blows the whistle on the male donor (senior manager), she may be concerned about jeopardizing future blood donations.
Mary should talk with Peggy about her experience. She may need counseling from the organization’s Human Resources Department or Employee Assistance Program.
Mary should also praise Joe for taking quick action in Peggy’s defense.
Peggy should discuss the incident with someone in the corporation’s ethics office or human resources department. This behavior may be part of a pattern and, if so, it would be important for them to know about the incident, so they can take action. Most large corporations would consider this kind of incident to be quite serious, especially if this executive is acting similarly with their own employees. Peggy could save the company from future legal problems by alerting them to the problem. At the very least, this individual should be barred from future blood donations.

Exercise #2 – Relativism/Idealism Scale (Forsyth, 1980)

The statements below are about your general philosophies. Please circle the number that indicates how much you agree or disagree with each item, IN GENERAL.






Strongly Disagree

Neither

Strongly Agree

1) A person should make certain that their actions never intentionally harm another even to a small degree.

1

2

3

4

5

6

7

2) Risks to another should never be tolerated, irrespective of how small the risk might be.

1

2

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6

7

3) There are no ethical principles that are so important that they should be a part of any code of ethics.

1

2

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7

4) What is “ethical” varies from one situation and society to another.

1

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5

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7

5) The existence of potential harm to others is always wrong, irrespective of the benefits to be gained.

1

2

3

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7

6) Whether a lie is judged to be moral or immoral depends upon the circumstances surrounding the action.

1

2

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7

7) Questions of what is ethical for everyone can never be resolved since what is moral or immoral is up to the individual.

1

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7

8) If an action could harm an innocent other, then it should not be done.

1

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9) Deciding whether or not to perform an act by balancing the positive consequences of the act against the negative consequences of the act is immoral.

1

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6

7

10) Rigidly codifying an ethical position that prevents certain types of actions could stand in the way of better human relations and adjustment.

1

2

3

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5

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7

11) One should never psychologically or physically harm another person.

1

2

3

4

5

6

7

12) One should not perform an action which might threaten in any way the dignity and welfare of another individual.

1

2

3

4

5

6

7

13) No rule concerning lying can be formulated; whether a lie is permissible or not permissible totally depends on the situation.

1

2

3

4

5

6

7

14) Dignity and welfare of people should be the most important concern in any society.

1

2

3

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5

6

7

15) Moral standards should be seen as individualistic; what one person considers to be moral may be judged to be immoral by another person.

1

2

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6

7

16) Moral actions are those which closely match ideals of the most “perfect” action.

1

2

3

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7

17) If an action could harm an innocent other, then it should not be done.

1

2

3

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7

18) Different types of moralities cannot be compared as to “rightness.”

1

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7

19) Moral standards are simply personal rules which indicate how a person should behave, and are not to be applied in making judgments of others.

1

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5

6

7

20) Ethical considerations in interpersonal relations are so complex that individuals should be allowed to formulate their individual codes.

1

2

3

4

5

6

7

To score:



  • Add scores from statements 1, 2, 5, 8, 9, 11, 12, 14, 16, and 17. The sum represents the score on the idealism scale.

  • Add scores from statements 3, 4, 6, 7, 10, 13, 15, 18, 19, and 20. The sum represents score on the relativism scale.

Total possible score on each scale = 70

Exercise #3 – Locus of Control
Students can have a difficult time understanding why locus of control is important. An easy way to help them understand this is to focus on the characteristics at the internal and external ends of the spectrum.
Internal Locus of Control:


External Locus of Control:

  • Follows orders and rules

  • Less likely to question you and authority in general

  • Very much influenced by peer pressure

  • Less likely to see how they (their role) can effect an outcome

Begin a discussion about why locus of control might be important, when you are hiring someone to do a specific job. The point: locus of control has implications for how people behave on the job and it is good to think about this.


For example: How might locus of control figure into:

  • Hiring an assembly line worker?

  • Hiring a nanny?

  • Choosing a doctor?

  • Naming someone to head a compliance function?

  • Selecting a nuclear power plant engineer?

  • Promoting someone in the military?


Exercise #4: Locus of Control Questionnaire
Another interesting exercise to encourage students to consider their own locus of control is to administer this questionnaire in class. Then have the students score their own – you can use a paper survey, use slides to ask each question, or even use an online survey program to collect the results and then feed them back during class.

Locus of Control Questionnaire
Instructions: Please read each pair of statements, (a) and (b). Then select which statement you agree with more. Check either (a) or (b) for each pair of statements.
1. ____ a) Many of the misfortunes people experience are partly due to bad luck.

____ b) People's misfortunes usually result from the mistakes they make.


2. ____ a) In the long run people get the respect they deserve.

____ b) Unfortunately, an individual's worth is often unrecognized, no

matter how hard he or she tries.
3. ____ a) Grades in school are generally a fair representation of the

student's effort and ability.

____ b) Most students do not realize the extent to which their grades are

influenced by accidental happenings.


4. ____ a) Without the right breaks one cannot be an effective leader.

____ b) Capable people who fail to become leaders have not taken advantage of

their opportunities.
5. ____ a) No matter how hard you try, some people just do not like you.

____ b) People who cannot get others to like them, do not understand how to get

along with others.

6. ____ a) I have often found that what is going to happen will happen.

____ b) Trusting to fate has never turned out as well for me, as making a

decision to take a definite course of action.


7. _ ___ a) If a student is well prepared, there is rarely, if ever, such a thing as an unfair test

____ b) Many times exam questions tend to be so unrelated to course work

that studying is really useless.
8. ____ a) Getting a good job is a matter of hard work. Luck has little or nothing to do with it.

____ b) Getting a good job depends mainly on knowing the right people.

9. ____ a) The average citizen can have an influence in government decisions.

____ b) This world is run by the few people in power, and there is not much

the average person can do about it.
10. ____ a) When people succeed, it is usually because they worked hard for it.

____ b) When people succeed, it is often because they were in the right

place at the right time.
Scoring

Instructor: Note that this is not a validated measurement instrument. It has been adapted from a variety of other instruments and is designed for instructional use only. The purpose is to familiarize students with the locus of control concept   not to measure an individual's locus of control. We recommend asking students to identify which statements refer to an external orientation and which statements refer to an internal orientation. Then discuss how this orientation might influence ethical conduct. I = internal E = external
1. ____ a) Many of the misfortunes people experience are partly due to bad luck. (E)

____ b) People's misfortunes usually result from the mistakes they make. (I)


2. ____ a) In the long run people get the respect they deserve. (I)

____ b) Unfortunately, an individual's worth is often unrecognized, no matter how hard he or she tries. (E)


3. ____ a) Grades in school are generally a fair representation of the student’s effort and ability. (I)

____ b) Most students do not realize the extent to which their grades are influenced by accidental happenings. (E)


4. ____ a) Without the right breaks one cannot be an effective leader. (E)

____ b) Capable people who fail to become leaders have not taken advantage of their opportunities. (I)


5. ____ a) No matter how hard you try, some people just do not like you. (E)

____ b) People who cannot get others to like them, do not understand how to get along with others. (I)


6. ____ a) I have often found that what is going to happen will happen. (E)

____ b) Trusting to fate has never turned out as well for me as making a decision to take a definite course of action. (I)


7. ____ a) If a student is well prepared, there is rarely, if ever, such a thing as an unfair test. (I)

____ b) Many times exam questions tend to be so unrelated to course work that studying is really useless. (E)


8. ____ a) Getting a good job is a matter of hard work. Luck has little or nothing to do with it (I)

____ b) Getting a good job depends mainly on knowing the right people. (E)


9. ____ a) The average citizen can have an influence in government decisions. (I)

____ b) This world is run by the few people in power, and there is not much the average person can do about it. (E)


10. ____ a) When people succeed, it is usually because they worked hard for it. (I)

____ b) When people succeed, it is often because they were in the right place at the right time. (E)



Additional Resources
1. Cognitive Moral Development:
Materials for measuring cognitive moral development using the Defining Issues Test can be obtained from the Center for the Study of Ethical Development, University of Alabama

305a Carmichael Hall, Tuscaloosa, AL 35487

Phone: 205-348-4571

2. Moral Disengagement
A measure of moral disengagement (particularly useful with undergraduates) can be found in an article by Detert, J.R., L.K. Treviño and V. Sweitzer. 2008. “Moral Disengagement in Ethical Decision Making: A Study of Antecedents and Outcomes.” Journal of Applied Psychology. 93: 374-391.
3. Video: Pinto Fires
Linda Treviño and Dennis Gioia have created an instructional DVD to accompany his “Pinto Fires” case and reflections (Chapter 3).

For years, Denny has taught the case to MBA business ethics classes as a "living case."  It has always been a big hit with the students, to be able to interact with Ford's recall coordinator himself and ask questions left hanging in the case.  

The DVD includes an introduction by Linda Treviño, Denny Gioia teaching the MBA class (edited to about 45 minutes), and some closing learning points by Denny.  We also created titled vignettes that an instructor can pick and choose to make specific points in a shorter time period. That seems to work best. The case is packaged with the DVD, along with a brief instructor's guide and suggested readings. 

We have priced the DVD at a reasonable cost, so that it will be accessible to any instructor who would like to use it.  Proceeds are being split between Penn State University's Media Sales and the Shoemaker Program in Business Ethics Endowment that supported creation of the DVD. 

Linda Treviño would be glad to answer any questions you have about using the DVD, which she has used successfully in several teaching settings.  The link to Penn State Media Sales, where you can purchase the DVD is below:


http://mediasales.psu.edu, or call: 814-865-3333

To find the “Pinto Fires” DVD, see the banner, third from the top, on the right.



4. Videos: ABC News

You can purchase the following videos or DVDs at the ABC News Store: www.abcnewsstore.com



  • “What Would You Do?” A series of video tapes that explore what people might do in various hypothetical cases. Cases vary and include subjects such as shop lifting and domestic violence.

  • “Basic Instincts” – the Milgram experiments revisited.


5. Video and Podcast: Nova’s “Mind Over Money”

Nova’s “Mind Over Money” is a fascinating exploration of how emotions and the way the brain works affect out behavior. Specifically this program shows how traders get so caught up in the game of trading that their ethics and ability to assess risks is compromised. Here is a link to the website: http://www.pbs.org/wgbh/nova/money/






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