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Chapter 4

BUS 223 Chapter Notes - Chapter 4: Sudden Unintended Acceleration, Iceberg, Determinative

Course Code
BUS 223
Haskovon Kriegstein

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BUS 223
Chapter 4 notes
March 9, 16
What is corporate Culture?
- Culture: Every organization is fashioned by a shared pattern of beliefs, expectation,
and meanings that influence and guide the thinking and behaviours of the members
of that organization
o No culture is static, culture changes
Culture and Ethics
- Habits are shaped and formed by education and training by culture
- Both culture and the members of a the culture are shaped by each other.
- No culture is static. Modifying cultures is like moving an iceberg, it’s always moving
and if you ignore it will continue to float with whatever currents hold sway at the
- 4 Principles of the Toyota Way served as the basis for its high quality and
consistent customer satisfaction, yet prevented them from responding to reports of
unintended acceleration in many of its vehicles in a responsible, swift, effective, and
transparent way
- Culture can be determined by exploring:
o Temp of work
o Organization’s approach to humour
o Methods of problem solving
o Competitive environment
o Incentives
o Individual autonomy
o Hierarchical structure, etc
- Cultures becomes so much a part of the environment that participants do not even
notice its existence
- When law is ambiguous in determining whether a business should make
reasonable accommodations, business culture is likely to be the determining
factor in the decision.
- FEMA example highlights that a higher value should be placed on health and human
dignity. FEMA was incapable of acting because of strict adherence to the law,
emergency personnel where even delayed because of a preventive sexual
harassment in the workplace. Coast Guard admiral’s rescue first, get permission
later culture was later instilled in FEMA as he replaced the previous director
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- Stronger ethical programs and cultures produce substantially better outcomes than
in weaker ethical environments
- Responsibility for creating and sustaining such ethical corporate cultures rests on
business leaders
Compliance and Value based cultures:
- A compliance-based culture is very traditional, and maybe out-dated
- A values-based or integrity-based culture is more flexible and far-sighted corporate
environments, reinforces a set of values rather than a set of rules
- Arguments in favour of values-based culture:
o Compliance culture is only as strong and precise as the rules, which cannot
cover every possible situation
o Value based recognized that where a rule does not apply the firm must rely
on personal integrity of its workforce when decisions need to be made
Ethical Leadership and Corporate culture
- Tone starts at the top, then needs to be consistent throughout the firm
- In thought, word and deed, a companies leaders must clearly and unambiguously
both advance and model ethical behaviour
- One of a leader’s primary responsibilities therefore is to be a role model by setting a
good example, by keeping commitments, by maintaining their own standards and by
supporting others doing so.
- Ethical leaders allocate resources to sport and promote ethical behaviour
- The extent to which ethical officers were supported financially indicated relevance
and influence within the organization. Ethics was not priority if some general consul
served as an ethics office in their spare time, and no additional resources were
- If a highly skilled individual is hired into an executive position as ethics officer and
is given staff and a budget, it has much more relevance to the company.
- A code of conduct in a supply chain promotes integrity and ethical behaviour
- One way leaders create shared culture is being perceived as a people-oriented leader,
as well as the importance of leaders engaging in visible ethical action.
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