TAKING SIDES: Clashing Views in Management, Second Edition
PART 1. Ethical Issues for Managers
ISSUE 1. Do Corporations Have a Responsibility to Society that Extends Beyond Merely Maximizing Profit?
YES: Robert D. Hay and Edmund R. Gray, from “Introduction to Social Responsibility,” in David Keller, man. ed., Ethics and Values: Basic Readings in Theory and Practice (Pearson Custom Publishing, 2002)
NO: Alexei M. Marcoux, from “Business Ethics Gone Wrong,” Cato Institute (July 24, 2000)
Robert D. Hay and Edmund R. Gray believe that corporations should be held accountable for more than profit maximization. Their argument is based on stakeholder theory and is presented in the form of an historical account of the evolution of managerial thinking on this important topic. In answering "no" to this question, Alexei Marcoux presents a frontal attack on stakeholder theory. Consistent with the views of Nobel Laureate Milton Friedman, Marcoux argues that the very nature of stakeholder theory is immoral and can only lead to disastrous results for all involved.
ISSUE 2. Is the Corporate Strategy of Downsizing Unethical?
YES: Larry Gross, from “Downsizing: Are Employers Reneging on Their Social Promise?” CPCU Journal (Summer 2001)
NO: Joseph T. Gilbert, from “Sorrow and Guilt: An Ethical Analysis of Layoffs,” SAM Advanced Management Journal (vol. 65, 2000)
Larry Gross contends that downsizing violates the psychological and social contracts implicit in the employer-employee relationship since there is an implied sense of job security afforded the employee as long as he or she is productively advancing the goals of the organization. Downsizing productive employees is a clear violation of this contract and, therefore, immoral. Professor Joseph Gilbert analyzes the ethicality of downsizing through the application of three prominent approaches to the study of ethics: utilitarianism, rights and duties, and justice and fairness. Gilbert concludes that, with one notable exception, downsizing is an ethically valid and morally responsible corporate behavior.
ISSUE 3. Is Bluffing During Negotiations Unethical?
YES: Chris Provis, from “Ethics, Deception and Labor Negotiation,” Journal of Business Ethics (Kluwar Academic Publishers, The Netherlands, 2000)
NO: Fritz Allhof, from “Business Bluffing Reconsidered,” Journal of Business Ethics (Kluwar Academic Publishers, The Netherlands, 2003)
Ethics scholar Chris Provis examines bluffing within the context of labor negotiations and concludes that it does indeed constitute unethical behavior. Bluffing, he argues, is deception and therefore, unethical, regardless of whether it occurs in or out of the negotiation process. University of California, Santa Barbara philosopher Fritz Allhoff presents a clever and unique defense of bluffing in business negotiations. The central tenet in Allhoff’s position is that certain roles that we are required to assume allow us to morally justify behaviors that might otherwise be considered immoral.
ISSUE 4. Should Insider Trading Be Legalized?
YES: Robert B. Thompson, from “Insider Trading, Investor Harm, and Executive Compensation,” Case Western Reserve Law Review (Winter 1999)
NO: Stephen Bainbridge, from “Why Regulate Insider Trading?” Tech Central Station (September 8, 2004)
Legal scholar Robert B. Thompson presents Manne’s argument on insider regulation. Thompson then provides us with an analysis of the status and relevance of Manne’s position three decades after the publication of his seminal text. UCLA professor of law Stephen Bainbridge does not accept Manne’s arguments. Bainbridge believes that insider trading ultimately causes inefficiency in the markets and, therefore, must be subject to regulation. PART 2. Organizational Behavior and Human Resource Management
New! ISSUE 5. Has Affirmative Action Outlived Its Usefulness in the Workplace?
New! YES: John H. McWhorter, from “The Campus Diversity Fraud,” City Journal (Winter 2002)
New! NO: Judith C. Appelbaum, from “Affirmative Action: End It or Defend It?” National Women’s Law Center, Speech at State University of New York at Binghamton (November 2, 2000)
In an article calling for the end to affirmative action, African American social commentator Dr. McWhorter draws on his experiences as a previous supporter of affirmative action while providing numerous insightful observations. Judith Appelbaum, speaking before the SUNY, Binghamton, argues that discrimination in the workplace is still very much with us today. And, since affirmative is needed to combat ongoing discrimination, it’s still needed today.
New! ISSUE 6. Is Workplace Drug Testing a Wise Corporate Policy?
New! YES: Ying-Tzu Lu and Brian H. Kleiner, from “Drug Testing in the Workplace,” Management Research News (vol. 27, no. 4/5, 2004)
New! NO: Jacob Sullum, from “Urine—Or You’re Out,” Reason (November 2002)
Human resource management scholars Ying-Tzu Lu and Brian H. Kleiner believe that workplace drug testing does not inherently violate employee privacy rights. They suggest that workplace drug testing can lead to increased firm profitability, primarily as a result of increased worker productivity. Reason magazine senior editor Jacob Sullum argues that not only is drug testing invasive and insulting, but that it has no real bearing on job performance.
New! ISSUE 7. Is Diversity in the Workplace a Worthwhile Goal for Corporations?
New! YES: Nancy R. Lockwood, from “Workplace Diversity: Leveraging the Power of Difference for Competitive Advantage,” HRMagazine (June 2005)
New! NO: Roger Clegg, from “Diversity Nonsense,” National Review Online (January 21, 2002)
Society for Human Resource Management human resource expert Nancy Lockwood discusses several important benefits that result from workplace diversity. Included among these is the possibility of increased organizational productivity and profitability. The opposing view is presented by social critic Roger Clegg, who attacks the notion that pursuing diversity for its own sake is a wise strategy regardless of whether it occurs in the workplace or in the educational system.
ISSUE 8. Is Gender Discrimination the Main Reason Women Are Paid Less Than Men?
YES: Stephen J. Rose and Heidi I. Hartmann, from “Still a Man’s Labor Market: The Long-Term Earnings Gap,” Institute for Women’s Policy Research (2004)
NO: Naomi Lopez, from “Free Markets, Free Choices II: Smashing the Wage Gap and Glass Ceiling Myths,” Pacific Research Institute (1999)
Stephen J. Rose and Heidi I. Hartmann, scholars at the Institute for Women’s Policy Research, argue in their 2004 study that discrimination is still the main reason for the persistence in the gender gap. Naomi Lopez, director of the Center for Enterprise and Opportunity at the Pacific Research Institute in San Francisco, provides evidence that the wage gap is a function of several different variables beyond gender discrimination. She concludes her analysis with the observation that we may never reduce the wage gap entirely and that such an outcome is not necessarily undesirable.
New! ISSUE 9. Would Reforming Social Security Be Good for American Business?
New! YES: James Morrison, from “Social Security Reform Helps Small Business,” The Heritage Foundation Backgrounder (October 17, 2001)
New! NO: Greg Anrig, Jr. and Bernard Wasow, from “Twelve Reasons Why Privatizing Social Security Is a Bad Idea,” TCF Issue Brief, The Century Foundation (December 14, 2004)
Political consultant and Social Security expert Dr. James Morrison presents an argument supporting Social Security reform and shows how it would be extremely beneficial to American business, particularly small business. The con side of this debate is provided by two important members of The Century Foundation: vice president Greg Anrig, Jr. and senior fellow Bernard Wasow. Their article consists of 12 reasons why privatizing Social Security is bad for business and bad for the country. PART 3. Strategic Management
New! ISSUE 10. Is Outsourcing a Wise Corporate Strategy?
YES: Sarah Anderson and John Cavanagh, from “Outsourcing: A Policy Agenda,” Foreign Policy in Focus (April 2004)
NO: Daniel W. Drezner, from “The Outsourcing Bogeyman,” Foreign Affairs (May/June 2004)
Sarah Anderson and John Cavanagh argue that outsourcing is a real threat to the economic health of the United States and provide several suggestions as to the types of governmental actions necessary to keep American jobs from moving overseas. Included in their discussion is an analysis of the views of the two 2004 presidential candidates, John Kerry and George W. Bush. Dr. Daniel Drezner argues that the controversy surrounding outsourcing is not new and that its current form is more hype than substance. He shows how outsourcing is actually economically beneficial to America, despite the warnings of critics. Dr. Drezner also asserts that the concept of outsourcing is consistent with a solid understanding of free-market capitalism and an appreciation of traditional American principles and values.
ISSUE 11. Are U.S. CEOs Overpaid?
YES: Lisa H. Newton, from “The Care and Feeding of the Truly Greedy: CEO Salaries in World Perspective,” Taking Sides: Business Ethics and Society (McGraw-Hill Dushkin, 2000)
NO: Ira T. Kay and Steven E. Rushbrook, from “The U.S. Executive Pay Model: Smart Business or Senseless Greed?” WorldatWork Journal (First Quarter, 2001)
Lisa Newton believes that the typical U.S. CEO should not receive ten or more times the annual pay of CEOs in other industrial countries. She also points out, in no uncertain terms, that CEOs are only partly responsible for the ultimate success of their organization and the accompanying increase in shareholder wealth. Ira Kay and Steven Rushbrook believe that U.S. CEOs are entitled to whatever levels of pay they receive. They argue from a free-market perspective where labor, like every other business input, is subject to free-market forces. They also provide a discussion on the incredible amount of wealth U.S. CEOs have created for their shareholders.
ISSUE 12. Corporate Governance Reform: Is Sarbanes-Oxley the Answer?
YES: Federal News Service, from “Conference Report on Corporate Responsibility Legislation,” Capital Hill Hearing, Federal News Service (July 24, 2002)
NO: Alan Reynolds, from “Sarbanes-Oxley in Retrospect,” The State of Corporate Governance: A Retrospective on Sarbanes-Oxley (Hill Briefing, December 12, 2003)
Actual testimony taken from a congressional hearing just prior to the vote on the act itself is presented in this article. Included are comments from the authors of the act, Paul Sarbanes (D-MD) and Michael Oxley (R-OH). Cato Institute senior fellow Alan Reynolds provides his audience with a scathing indictment of the mind-set and philosophy beyond the creation of the act in his argument that Sarbanes-Oxley was not a positive reaction to the call for corporate governance change.
New! ISSUE 13. Is First-to-Market a Successful Strategy?
New! YES: William T. Robinson and Sungwook Min, from “Is the First to Market the First to Fail? Empirical Evidence for Industrial Goods Businesses,” Journal of Marketing Research (February 2002)
New! NO: William Boulding and Markus Christen, from “Sustainable Pioneering Advantage? Profit Implications of Market Entry Order,” Marketing Science (Summer 2003)
Scholars William T. Robinson and Sungwook Min provide results of a study indicating that the advantages from being first outweigh the risks of implementing the strategy. William Boulding and Markus Christen take a contrary position and argue that first-moving is not necessarily a wise strategy, presenting evidence from their own research that, in the long-run, first-movers actually experience performance disadvantages.
New! ISSUE 14. Must Firms Constantly Grow to Be Considered Successful?
New! YES: Clayton M. Christensen and Michael E. Raynor, from The Innovator’s Solution (Harvard Business School Press, 2005)
New! NO: Jim Mackey and Liisa Välikangas, from “The Myth of Unbounded Growth,” MIT Sloan Management Review (Winter 2004)
Clayton M. Christensen and Michael E. Raynor argue that firms are subject to pressures to continually grow from sources both inside and outside of the organization. Business scholars Jim Mackey and Liisa Välikangas cite many interesting statistics to support the view that lasting growth is elusive and unrealistic and, thus, not necessary to define a firm as successful. PART 4. Environmental and International Management Issues
ISSUE 15. Is the Condition of the Environment Really as Bad as Environmentalists Claim?
YES: David Pimentel, from “Skeptical of the Skeptical Environmentalist,” Skeptic (vol. 9, no. 2, 2002)
NO: Denis Dutton, from “Greener Than You Think,” Washington Post On-line Edition (October 21, 2001)
In his review of The Skeptical Environmentalist, David Pimentel disagrees with Lomborg’s optimistic assessment. He also accuses Lomborg of selectively presenting advantageous data while simultaneously ignoring evidence that is damaging to his position. Denis Dutton, professor of philosophy at the University of Canterbury in New Zealand, agrees with Lomborg that the environment is much better off than the environmentalists would have us believe.
New! ISSUE 16. Should U.S. Corporations Be Allowed to Hire Illegal Aliens?
New! YES: Rob Paral, from “Essential Workers: Immigrants Are a Needed Supplement to the Native-Born Labor,” Immigration Policy Brief (American Immigration Law Foundation, March 2005)
New! NO: Fred Dickey, from “Undermining American Workers: Record Numbers of Illegal Immigrants Are Pulling Wages Down for the Poor and Pushing Taxes Higher,” Los Angeles Times (July 20, 2003)
Rob Paral, a research fellow with the Immigration Policy Center, believes that the pluses of hiring illegal immigrants outweigh the minuses. Fred Dickey disagrees. In a detailed exposé on immigration published in the Los Angeles Times, reporter Dickey maps out his case against the use of illegal immigrants in the American workforce.
ISSUE 17. Is Economic Globalization Good for Humankind?
YES: Murray Weidenbaum, from “Globalization Is Not a Dirty Word: Dispelling the Myth About the Global Economy,” Vital Speeches of the Day (March 1, 2001)
NO: Herman E. Daly, from “Globalization and Its Discontents,” Philosophy and Public Policy Quarterly (Spring/Summer 2001)
Foreign policy expert Murray Weidenbaum, in a reprint of a speech he delivered in 2001, promotes his "yes" response by systematically presenting, and then debunking, the most common "myths" surrounding globalization. He believes that globalization is a force for positive change. Professor Herman Daly feels that increasing globalization requires increases in political, social, and cultural integration across borders as well. The outcome is a loss of national identity for the countries involved as power is transferred from traditional domestic sources—i.e., governments, domestic businesses, local enterprises—to transnational corporations.
ISSUE 18. Are Global Sweatshops Exploitative?
YES: Richard Appelbaum and Peter Dreier, from “The Campus Anti-Sweatshop Movement,” The American Prospect (September-October 1999)
NO: Radley Balko, from “Sweatshops and Globalization,” A World Connected Web Site (2004)
The first article, written by scholars Richard Appelbaum and Peter Dreier, chronicles the rise of the grassroots, college campus, anti-global sweatshops movement in the late 1990s. Columnist and social commentator Radley Balko argues that sweatshops are not exploitative. His article presents several additional points frequently offered in defense of globalization in general, and sweatshops in particular.
