Introduction Ethics meaning that is provided in Oxford dictionary is “moral philosophy” and for ethic, it is “moral principle”. Ethics has highest honor in every perspective of its application area whether it is in business, society or community or in personal life. Especially in conduct of business, both management and labor are expected to practice certain established ethics for gaining mutual benefit in the stature of business. Ethics can never be contradictory as the works of ethics are considered to be right and appropriate, fair and honest in all aspects.
Reputation is an intangible asset for organizations in order to exercise the power of negotiation. Reputation cannot be gained in an year or two, whereas it is a continuous process of winning every day storing good acts and principles in order to succeed in organizational business capacity.
There is no place without a conflict and no problem is without a solution. This is the present trend in globalization business where there are effective management tools, techniques, vigilant systems for eliminating hindrances and bringing almost everything to order of efficient working. The only probability that is to be analyzed here, the application of management techniques when and how to apply these, when encountered with a situation or conflict in an establishment.
Another name for negotiations, could be war of words, or an argumentative discussion or a debate where there are fundamental presentation of facts, acts and works. There are many reasons attributed for successful negotiations and a similar negative reasons for poor and failure negotiations.
Before negotiating any issue, it is required to do certain homework in identifying the core issue, causes that have lead to this point of negotiation, remedies available, analysis of benefits / losses from POV of organization, short-term or long-term and finally whether the entire negotiation is legal and ethically binding an organization for improving and building the reputation of an organization. In this scenario, references of previous similar case studies also have to be studied to refer to the union or labor wherever necessary.
If the present case is to be studied, union has been outrageous in spite of knowing the fact that, due to economic downturn, the company has been forced to layoff workers. The options that are available for workers are either to stay and work with the company on the terms and conditions that are proposed by CEO in view of the fact that skilled workers have harmonious relations with the company, and who were sharing the long term success of the company.
For any part of negotiation, the following ten tips have to be applied in order to be ethical in practice by one hundred percent. A complete understanding of what is negotiable and what is not negotiable. An effective negotiator would never keep workers under guessing work and is much more clear in concept and problem presentation. Being very honest in focusing the problem area and negotiating thereafter on the issue is another moral principle.
Promises to be kept always as this adds to the reputation and also in putting off arguments from the other end.Keep a record of options: Every part of negotiation has two ends, if Group A is on the positive side, Group B by all means is on negative side and acceptance or refusal of options is always a choice whether to stay in with the deal or cancel the deal. Be ready to say “No” in presentation of facts and acceptance of terms. Stand upright in terms of legal rules in negotiations as ignorance of law is of no excuse and would termed as unethical.
Demonstrate mental strength in explaining the positive effects of negotiations and benefits that are attached to the same. Do not experiment on giving surprises to workers. Placing facts, discussing and negotiating is apt and appropriate and any thing beyond this, would work out as a surprise to workers. Follow golden and platinum rules of treating workers in an acceptable manner, with the view to expect a similar treatment for organizations from the end workers union.
Ready to give up deal with the fact that at times, when negotiations do not move further in a positive manner, and when there is no way out except to walk out from deal, accept it gracefully and think plan of another door to open for another raw deal.
Negotiations are part of business environment. Joint ventures, lease agreements, mergers, day-to-day disputes, salaries and benefits have to be dealt with in regular business functioning. The golden rule that is to be applied here for all good to take place, universalism, utilitarianism and distributive justice. Although negotiation is a hard task, when ethics are applied in professional manner, the negotiating task becomes much easier process for implementation of strategic changes.
It is important for operation manager to bring down hard hearted mindset of union of workers and explain about situation of the company. It is also important to explain to the union workers that company’s management is no way against the wishes of union workers except to the fact that laying off of workers is only due to unforeseen market situation that has affected the company in poor payment of salaries to the workers.
In another case of American Airlines, on April 23, 2003, former CEO resigned from the company after a service of 20 years, on the demand of union workers. Don Carty, was recommending a pay cut to bring the company out of crisis situation. Carty also introduced a pension package of $41 million for 45 executives. Union workers did not approve the package of Carty and instead considered a lapse in ethics and demanded the resignation of CEO.
On the other side, if Carty would put forth the real intentions of retaining the executive team is in order to sustain the company out of crisis period, the outcome of negotiation probably, would have been different by union workers. The union workers retrieved all the facts from press and lead Don Carty to resignation. Once again it is reiterated here that years of reputation can be destroyed in less than moment, which is why building and maintaining reputation is all the more important for resolving any situation or in confronting any failure.
Conclusion Labor unions have excessive bargaining powers and always consider a public and press assistance in gaining demands from companies, whereas it is a private affair between company’s management and labor union to be resolved and not public affair.
Author: Peg Tittle
Title : Ethical Issues in Business: Inquiries, Cases and Readings
Page Accessed : 296
Date Accessed 14 November, 2007
Author : Richard E.Walton
Title : Strategic Negotiations: A theory of change in labor-management relations
Page Accessed : 28
Date Accessed 14 November, 2007
Peter B.Stark Jane Flaherty, Ethical Negotiations: 10 Tips to Ensure Win-Win Outcomes
Accessed 14 November, 2007