Managing Change Ethically
Running head: MANAGING CHANGE ETHICALLY
Managing Change Ethically
Argosy University Online
Ethics in Business
Managing change ethically has become a ubiquitous concern in organizations as they evaluate strategies to increase profit margins and remain competitive in their industry. Outsourcing and offshoring are common business methods used to manage economies. An increase in the use of outsourcing by U.S manufacturing companies in 2001 generated approximately 7.8 billion dollars in spending (Robertson, Lamin & Livanis, 2010). Although outsourcing and offshoring contribute to organizational gains by reducing costs, improving efficiency and increasing profitability, the Bureau of Labor Statistics reported in 2004, 60% of all layoffs entailed domestic relocation of business activities with outsourcing representing approximately 11% of all layoff actions and offshoring roughly 20% (Robertson, Lamin & Livanis, 2010).
According to Argosy (2010), “outsourcing business operations requires careful ethical considerations that should include the interests of all stakeholders” p 2. Consumers and shareholders are more aware and sensitive to the ethical issues concerning these practices (Robertson, Lamin & Livanis, 2010). It is essential that key decisions regarding organizational change are weighed against its impact on the company’s stakeholders; employees, consumers, investors, and society (Robertson, Lamin & Livanis, 2010). According to Roberston, Lamin & Livanis (2010), “the perceptions of external stakeholders affect marketplace success. Attention to their concerns may help a firm avoid decisions that hinder objectives” pg. 169. From an ethical stance, we need to examine the most important issues concerning outsourcing and offshoring which are product quality, information security and labor conditions (Robertson, Lamin & Livanis, 2010). A decline in product quality is possible due to a reduction in management oversight
Managing Change Ethically
Argosy University Online
Ethics in Business
Managing change ethically has become a ubiquitous concern in organizations as they evaluate strategies to increase profit margins and remain competitive in their industry. Outsourcing and offshoring are common business methods used to manage economies. An increase in the use of outsourcing by U.S manufacturing companies in 2001 generated approximately 7.8 billion dollars in spending (Robertson, Lamin & Livanis, 2010). Although outsourcing and offshoring contribute to organizational gains by reducing costs, improving efficiency and increasing profitability, the Bureau of Labor Statistics reported in 2004, 60% of all layoffs entailed domestic relocation of business activities with outsourcing representing approximately 11% of all layoff actions and offshoring roughly 20% (Robertson, Lamin & Livanis, 2010).
According to Argosy (2010), “outsourcing business operations requires careful ethical considerations that should include the interests of all stakeholders” p 2. Consumers and shareholders are more aware and sensitive to the ethical issues concerning these practices (Robertson, Lamin & Livanis, 2010). It is essential that key decisions regarding organizational change are weighed against its impact on the company’s stakeholders; employees, consumers, investors, and society (Robertson, Lamin & Livanis, 2010). According to Roberston, Lamin & Livanis (2010), “the perceptions of external stakeholders affect marketplace success. Attention to their concerns may help a firm avoid decisions that hinder objectives” pg. 169. From an ethical stance, we need to examine the most important issues concerning outsourcing and offshoring which are product quality, information security and labor conditions (Robertson, Lamin & Livanis, 2010). A decline in product quality is possible due to a reduction in management oversight
References: Argosy. (2010). Leadership. Retrieved from http://myclassonline.com Argosy. (2010). Outsourcing. Retrieved from http://myclassonline.com Ethics of Outsourcing. (n.d.). Retrieved from http://www.outsource2india.com/why_outsource/articles/ethics_outsourcing.asp Gilbert, J. T. (2000). Sorrow and guilt: an ethical analysis of layoffs. Retrieved from http://www.allbusiness.com/management/543491-1.html Robertson, C. J., Lamin, A. & Livanis, G. (2010). Stakeholder perceptions of offshoring and outsourcing: the role of embedded issues. Journal of Business Ethics, 95 (2), 167-189. Whitmore, J. (n.d.). Leadership is not what it used to be: something really has to change Retrieved from www.ihexcellence.org/doc/leadership_whitmore.doc