Quality Management, Ethics, and Corporate Social Responsibility

Christina FryeMyriah Fillenwarth

Our Goals

• Tie the semester together for you• Answer your questions• Turn the view of ethics from a negative to a

positive

Ground Rules

• Ask dumb questions• Make mistakes• Collaborate• Have an open mind• Share what you know• Have fun!

Icebreaker

Objectives

• After this class you will be able to answer the following questions– What are ethics, integrity, values, and morals?– Why do we have unethical behavior?– How can we look at ethics from a systems view?– How does ethics fit into total quality?– How can we drive ethical behavior to instill total

quality?

What Are Ethics?

• Ethics are about doing the right thing within a moral framework.

• The values of an individual or an organization define what is ethical.

What are Values?

• Values are deeply held beliefs that form the very core of who we are

Integrity

• Integrity is a combination of honesty and dependability

Moral

• What is right and what is wrong

What does it mean to be ethical?

Why do we have unethical behavior?

Employees Needs and Wants (Maslow’s Hierarchy)

Ethics from a Systems View

Customer Focus

Leadership and Management Commitment

Four Cornerstones of Ethical Leadership

Truth Telling

Promise Keeping

Fairness Respect for individual

Supplier Partnership

Employee Empowerment & Quality Culture

Employee Empowerment and Quality Culture

Subpar

OrdinaryGood Enough Extraordinary

How do we shift the distribution of our performers to gain more “extraordinary” performers?

Results if We Create an Ethical Culture

Ethical Culture

Customer Satisfaction

& Trust

Employee Commitment

& Trust

ProfitsInvestor

Loyalty & Trust

Continuous Process ImprovementGood Enough is Never Good Enough

• Gap-cause analysisroot causesethics audits and feedback

• System-wide improvement• Training-continuously improving ethics

training• Standardizing solutionskeep from

reoccurring• Move beyond what is in our internal system to

look at the entire system

Corporate Social Responsibility

• An organization’s obligation to maximize its positive impact on stakeholders and to minimize its negative impact on society

• Four Levels– Legal– Economic– Ethical– Philanthropic

Code of Conduct

• Formal statements that describe what an organization expects of its employees

• Code of Ethics: comprehensive document consisting of general statements that serve as principles and the basis for the rules of conduct

• Statement of Values: serves the general public and addresses stakeholder interests

Activity Rules• Divide into four organizations• Think about the organization’s core values as they

relate to the 5 pillars of total quality– Customer focus, leadership and management

commitment, employee empowerment and quality culture, supplier partnership, continuous process improvement

• Come up with at least one statement for each pillar that you will include in your code of ethics/code of conduct

• How will you distribute your code or make it available to your employees?

Review

• Define ethics, value, integrity, and moral• Who is at stake/impacted by our decisions?• How does ethics fit into each of the 5

principles of TQ?

TRUST

Enhance Transfer

• How will you apply something we talked about today?

• What is your goal?

References• Best Buy Co., Inc. (2007). 2007 Corporate Social Responsibility Report. Retrieved April 2, 2010 from

http://www.bbycommunications.com/csr/CSR_2007_Final.pdf • Clawson, J. G. (2009). Level three leadership: Getting below the surface (4th ed.). Upper Saddle

River, NJ: Prentice Hall.• Ferrell, O. C., Fraedrick, J., & Ferrell, L. (2010). Business ethics: Ethical decision making and cases:

2009 update (7th ed.). Mason, OH: South-Western Cengage Learning.• Goetsch, D. L., & Davis, S. B. (2010). Quality management for organizational excellence:

Introduction to total quality (6th ed.). Upper Saddle River, NJ: Prentice Hall.• Henderson, D. R. & Hooper, C. L. (2009, September 9). Pfizer’s $2.3 billion-dollar settlement.

Retrieved March 28, 2010 from www.forbes.com/2009/09/08.• Nintendo of America. (2010). Nintendo of America’s code of conduct. Retrieved April 2, 2010 from

http://www.nintendo.com/corp/coc.jsp• Piechocki, M. (2007, October 1). Five orthopedic device companies reach settlement with DOJ for

investigation into consulting practices. Retrieved March 29, 2010 from www.orthosupersite.com/view.aspx?rid=24187

• University of Illinois Ethics Office. (2010). Code of conduct. Retrieved April 2, 2010 from http://ethics.uillinois.edu/policies/code.cfm

• YUM! Brand, Inc. (2010). Supplier code of conduct. Retrieved April 2, 2010 from http://www.kfc.com/about/supplier.asp.