Implementation of the Moldable Model© in Your Organization
Several years ago, I was pontificating, using the written word, for a master-level discussion board in a leadership theory course. I was expressing what my 30 years of leadership experience brought to the discussion. The instructor responded to my eloquent flurry of words by saying: “Don, I am sure that your 30 years of leadership experience is valuable for lessons learned; however, in this course we are not so much interested in your opinion as we are interested in what the research literature demonstrates.” After the hit to my ego passed, Dr. Mike DeGrosky’s words changed my academic life. I dug into the research literature to write, think, and practice leadership and management from a scholarly voice, which was only amplified through my doctoral work.
The point is that we all have opinions based on our experiences in life and at work. Someone said that opinions are like belly buttons—we all have one! Indeed we do, and we are often not shy about expressing that opinion, especially how the workplace should work. While our leadership and management experiences are illustrative and informative, our single experiences do not rise to the level of leadership or management by evidence. Every organization needs to understand the evidence or the research-based principles of leadership and management in order to make better decisions and to utilize best practices from the field (Pfeffer and Sutton 2006).1 Pfeffer’s Law states: “Instead of being interested in what is new, we ought to be interested in what is true” (Pfeffer and Sutton 2006, 29).2 Dr. DeGrosky also told me that practice informs theory and theory informs practice. His meaning sums up most leadership and management research, including ethical leadership research. Researchers study, observe, and survey organizations in order to gain the lived experiences (qualitative research) and the statistics (quantitative research) available in the real world from those that practice leadership and management. From the qualitative and quantitative analysis of those research studies, new theories emerge for practice. That is how practice informs theory. Theory eventually informs practice, as theories are practiced and tested in the real-world workplace. The end result is leadership or management of organizations from evidence or research-based practice. Research-based practice helps us move beyond the singular opinion of our own experiences to the research-based opinions or practices of many subjects in diverse organizations. Though there are always limitations to the generalizability (quantitative) or the conveyability (qualitative) of specific research to all organizations, today’s leaders and managers can certainly be more confident in working from research models than from personal opinion.
To lead and manage the ethical environment of your organization, you could operate from your own personal morality or your own experiences in ethics to create a corporate ethical management system (CEMS). As the executive, you could demand adherence to your personal beliefs and morality, but you lose the benefit of collaboration or shared leadership of the company’s ethical environment. Plus, you operate from an antiquated paradigm of leadership—top-down, command and control, and an authority-only relationship (Rost 1993).3 While authority relationships, called management, are needed for accountability to the CEMS, the creation of company morals takes influence relationships, called leadership.
As the company executive, you could also operate from the morality and the opinions of all stakeholders in order to create your organization’s CEMS. Of course, if this approach is utilized alone, the sheer diversity of morality among organizational stakeholders will only lead to inflamed discussions without progress in practice.
The better approach to an organization-specific CEMS is to operate from evidence using a research-based model. The ethical leadership research, found in textbooks and journal articles, offers much data on how to create, enhance, lead, and manage the corporate ethical environment. As the executive, you could devour the thousands of pages of research literature and pick and choose methods and components suggested by the researchers in order to evaluate and/or create a CEMS for your organization. Certainly, this is a valid option for two reasons: the literature offers research-based tools to lead and manage by evidence, and as the executive who knows your organization, you can pick that which best fits your company. However, this option is quite limited in that it will take you months to devour all the ethical leadership research and you will create a hodge-podge system from your selected methods or components.
This book suggests that the best approach to an organization-specific CEMS is to start with the Moldable Model© (MM) represented throughout these chapters. The MM emerged from a rigorous and detailed qualitative, multiple case study approach to discover how organizations led and managed business ethics. The purpose of the study was an attempt to discover consistent methods or components that would work together to form an effective CEMS. Three organizations formed the multiple cases of this research. Two organizations were major, global companies in the for-profit and not-for-profit sectors, representing two different industries. The third organization was a small, local for-profit that had been in business for a century and a half, representing a difficult industry in which to operate for that length of time. Data streamed from interviews with executives and employees, content analysis of organizational documents, and observational tours of each organization’s facilities to determine how business morality and ethics were created, promoted, publicized, implemented, and enforced.
The MM research started with components for a CEMS found in the extant research literature, such as codes, discipline, rewards, audits, communication, training, and value statements. Those a priori (prior existence) components were compared to what emerged from the research data. Data were interpreted through single case and cross-case analysis allowing for over 200 touches of the collected data. After patterning and reduction of data, the MM emerged as an effective framework for the evaluation and/or the creation of a CEMS for any organization. Though conveyability (transferability) or the application of the MM to all organizations is limited due to the sample size, the diversity of the three organizations and the rigorous handling of data allowed for some confidence in the application of the MM across organizations in diverse sectors and industries (Dunn 2013).4 Therefore, the MM offers a research-based framework and a “proposed standardized model for executives in the construction of an organization-specific CEMS and the ability to utilize tested ethical components that are effective for like organizations” (Dunn 2013, 193).5
Start with the Basic Component Framework
The framework of the MM of context, role modeling, and accountability provides for a flexible approach to the organization-specific implementation of the model. The MM is effective to evaluate your organization’s current CEMS and/or to create a new, more effective CEMS for your company.
Evaluation of the Current CEMS
To begin the process of the implementation of the MM in your organization, start with the evaluation of your current CEMS. You may or may not have a formal system of intentional components, but the evaluation process is the same.
First, review the context of your CEMS, meaning the why of or reasons for its current or desired existence. What have you shared with employees about why your company desires to be ethical? Have you discussed deontological (duty, right thing to do, virtue, character) and teleological (best benefits for the greatest number, satisfied and committed employees who have more comfort and fun, employee performance and organizational productivity, financial performance, and competitive advantage) reasons for the existence of or the desire to create a CEMS? Better yet, have you had a discussion in which you collaboratively sought from employees the reasons to be ethical?
Second, review the role modeling of your code of ethics (COE) (if you have one) and any appropriate ethical leader (EL) attributes. Are top-tier (TT) executives good role models of business or company ethics? What EL attributes are top leaders role modeling to employees and organizational stakeholders? What values and behaviors from the COE do top leaders consistently demonstrate in front of employees? How are lower-level employees or peer-to-peer (P2P) employees expected to role model the COE or EL attributes? In your evaluation of role modeling systems in your company, review any mentoring processes in place. Are these processes effective based on the intentional role modeling among TT executives and P2P employees of the company COE and EL attributes in daily practice? Are new hires paired with TT executives and P2P employees?
Third, review the accountability processes of the CEMS currently in place. Do decision makers utilize the COE and a formal decision-making ladder (DML)? How does the hiring process of your company incorporate its ethical values? Do you hire and interview for value-fit? What are the consistent training processes already in place to teach and remind employees of company ethics? Are the visual representations of the COE placed strategically throughout the facility, enough to remind but not so much as to make irrelevant? What reward and discipline processes are in place for ethical and unethical behavior? Is there a good balance of rewards and discipline? Is the discipline process stepped, fair, and consistent? What do you consider an ethical audit in your organization?
The evaluation of company ethics and the current CEMS takes time and should be handled with involvement from a stratified sample of organizational stakeholders. As you determine the demographics of your organization, place that demographic representation in a focus group that meets regularly to answer the above questions regarding your company’s ethics. TT leaders and P2P employees should also be represented on the focus group to demonstrate collaboration and to gain ownership and a fair evaluation of the CEMS.
Creation of a CEMS
The creation of a new or a revamped company CEMS should follow the same framework of the MM, as did the evaluation.
First, consider the context or the why your organization should be ethical in its business dealings. What are the reasons for ethical behavior on which your organization wishes to focus and promote to all stakeholders? Do you have a mixture of deontological (duty, right thing to do, virtue, character) and teleological reasons (best good, employee and organizational benefits)?
Second, consider the role modeling processes you want to put in place in your organization. Will you use the COE or EL attributes as a basis for role modeling? Do you want a mentoring system as described in this book? If you do not have a succinct, salient, and memorable COE, what mnemonic device would you create?
Third, consider the accountability processes you might use to manage your company ethics. Could your organization utilize a DML? Will you begin accountability in the hiring process with value-fit interviewing? What training systems do you need and at what consistency? Will your visually market your company ethics to employees throughout your facilities and to all organizational stakeholders? Are rewards important to you in the accountability for company ethics? How important is a stepped-discipline process to your CEMS? Should an ethical audit be a part of the CEMS, and if so, how often should the audit take place?
The questions offered in the evaluation section allow you to evaluate your current CEMS no matter at what level your company currently resides in using CEMS components. Specific components mentioned in these questions allow you to compare the same components to the MM components discussed in this book. If your CEMS does not have the same components as the MM, then these questions allow you to think about the need of those components.
The questions offered in the creation section allow you to begin the process to create a new or to improve on your current CEMS. Before we move to the actual creation of your organization-specific CEMS, some advice from Kohlberg’s moral reasoning theory is needed.
Application of Kohlberg’s Moral Reasoning Theory
Kohlberg’s model of cognitive thinking about ethics demonstrated that people reason morally in stages (Kohlberg and Hersh 1977)6:
1. Preconventional Level—at Stage 1, persons make moral decisions to avoid punishment, and at Stage 2, persons make moral decisions to gain reward. These two stages are the lowest levels of moral reasoning. In ethical decision making, people begin at the preconventional level, but hopefully advance in their moral reasoning to the. . . .
2. Conventional Level—at Stage 3, persons make moral decisions based on peer expectations, and at Stage 4, persons make moral decisions based on the expectations of society and authority entities. After making ethical decisions based on the expectations of others, people could advance further in moral reasoning to the. . . .
3. Postconventional Level—at Stage 5, personal values could affect societal rules instead of societal values affecting personal values, and at Stage 6, personal values are based on deontological or principled rules such as justice, the Golden Rule (treat others as you want to be treated), and Kantian principles of universality, reciprocity, and respect-ability.
Kohlberg’s moral reasoning theory offers some creative ideas as to the creation and implementation of an effective CEMS (Dunn 2013)7:
1. Level 1—people make decisions ethically to avoid punishment and to gain reward. Therefore, it is strategic for organizations to develop reward and discipline processes to manage company ethics. Baucus and Beck-Dudley (2005) did not approve of rewards and discipline as a method of accountability for organizational ethical behavior due to motivation from selfish interests.6 However, some employees new to the organization may need this low-level motivation to gain an understanding of company ethics, much like children do at early stages of moral reasoning.
2. Level 2—expectations of peers and authority figures are important in making ethical decisions. For the organization, role modeling by TT leaders and P2P employees of the company COE and/or the selected EL attributes is key to employees moving to Level 2 and abiding by the expectations of others. Therefore, mentoring programs are a practical application of role modeling, ethical leadership, social learning, and social exchange theories for the development of ethical employees and for the implementation of Level 2 moral reasoning in the company.
3. Level 3—people progress through moral reasoning to the level of self-chosen ethical principles that often challenge current societal or even workplace rules. Employees can move to Level 3 with the help of the organization by allowing all employees to collaborate on the creation of a COE, the selection of EL attributes, and the creation of the overall CEMS. This gives the organization input from a diverse sample of employee beliefs and personal values, along with employee understanding of cultural and societal perspectives that help formulate company ethics. This act of collaboration also raises the level of social exchange theory in which employees reciprocate the ethical behavior of executives based on positive relationships.
Baucus and Beck-Dudley (2005) thought that organizations could use Kohlberg’s model to design ethical organizations, to train employees in moral reasoning, and to develop employees toward higher levels of motivation to keep company ethics.7 Sekerka (2009) implied that the CEMS could be a part of employees’ improvement in moral reasoning.8 The use of the principles of Kohlberg to create an implemented and practiced organization-specific CEMS seems to have the potential to not only lead and manage company ethics, but also to improve all stakeholders toward higher levels of moral reasoning.
Collaborate on Creating an Organization-Specific CEMS
It is now time to create or to improve your organization-specific CEMS. The MM represents a flexible framework from which you can choose specific components that best meet the needs of your organization. I suggest that the creation process be a collaborative effort among as many organizational employees as is possible and reasonable. That does not mean that every employee needs to participate at every step of the creation process. But, every employee should have the opportunity for input into the CEMS at some level, either through surveys, interviews, or focus group participation. As the executive of the organization, it becomes your responsibility to weigh this suggestion as to its proper implementation in the creation process. You know your organization better than I, but do not dismiss this suggestion because of hurdles and time constraints. You will have a better organization-specific CEMS and the implementation of the new model will have employee ownership, support, and motivation to practice its principles.
First, decide on the context, the why, the reasons your organization will use to defend the creation and use of a CEMS.
1. From deontological reasons, what specific duties do you have toward all stakeholders to be ethical? Why should you be ethical?
2. What principles guide your organization toward ethical behavior? Take time with your CEMS creation teams to select EL attributes that are important to your organization. These are the virtue or character attributes your company wishes to demonstrate to stakeholders, including the customers and surrounding or global community.
3. What teleological or outcome reasons will you decide to use to defend your CEMS to employees and all stakeholders? I have given you well-supported, researched outcome reasons to be ethical (leadership and management by evidence): employee satisfaction and commitment, employee comfort and fun, employee productivity, organizational financial performance, and competitive advantage. Which of these teleological reasons will you choose to promote within and without your company?
Second, decide on how your will implement a role modeling system as one of the components of the CEMS. Executives and employees must role model company ethics in the form of the COE or selected EL attributes or a COE based on selected EL attributes.
1. If you do not have a COE with stated values and demonstrated behaviors, now is the time to create that artifact. What values or EL attributes will you select and what behaviors will demonstrate that those values are practiced in the organization? How will you make the COE succinct, salient, and memorable? What will be your mnemonic device to help employees easily remember the COE?
2. Will you create a mentoring program that pairs new hires with both TT executives and P2P employees so that role modeling of the COE is seen in action? Which executives and employees can you trust to be mentors to new hires? What is the duration of the mentoring program with executives and with employees? Will you assess the effectiveness of your mentoring program through the individual debriefs of new hires following the mentoring period?
Finally, decide on the accountability measures you will implement to assure compliance with the created CEMS.
1. Will you create a DML, and if so, what ethical theories would comprise that decision-making tool? How will you monitor decision makers to ascertain if the created DML is practiced on a regular basis?
2. How will you upgrade hiring processes to assure employee value-fit with organizational standards? What questions will be added to your hiring interview protocol based on the COE?
3. What are the specific training sessions you will implement to teach and remind employees of company ethics, and with what frequency?
4. Have you created an appealing graphic form of your COE, and in what strategic places will you market the COE? Does the COE have a prominent place in the facilities of your organization, on walls, in bathrooms, and in break rooms? Is the COE on the first page of your organizational website in full detail and on each web page as a smaller graphic? Is it possible to place the smaller graphics on your company letterhead? Do employees wear a key card or name card with the COE displayed on the back?
5. What specific rewards do your individual employees value that could be used to reinforce the COE? Will the rewards be monetary, verbal and visible recognition, celebration parties, or employee promotion and advancement?
6. How many steps will you walk through to discipline an employee for noncompliance to the COE, and will you skip steps in order to quickly terminate an employee for serious breaches of company ethics?
7. What processes will you use to create a consistent, at least yearly, ethical audit? Will you use surveys based on the COE, 360-degree feedback tools, total quality management tools like Six-Sigma, the Balanced Scorecard, and so on, exit interviews of departing employees, or focus groups? How will you gain and keep employee interest in an ethical audit? What plans have you made for the reporting of and notice of changes to the company based on the ethical audit?
These seven steps allow you to systematically and collaboratively walk through the creation of your organization-specific CEMS. The questions provide some guidance and hopefully engender creativity to help you choose what components make up your CEMS. Remember that the MM is a flexible framework to give you the research-based guidance to select and choose components that best work in your organization.
Engrained Ethical Theory
The executive of the for-profit global company that offered the framework of the MM from my research also shared this story about his company’s negotiations with a large, corporate energy supplier (Dunn 2013).9 Negotiations with the global energy company seemed on-target for a win–win deal for both companies. During the discussions at the bargaining table, the for-profit company sensed something was amiss with the energy supplier and backed away from negotiations. Criticism from other organizational players did not stop the for-profit global company from ending a potential relationship with this major energy supplier. Sometime later, the executive’s company’s decision was supported when the global energy company went defunct and all employee and shareholder benefits disappeared. The executive interviewed for my research believed that his company’s ethics were so engrained in decision makers that this was an easy decision to make.
Based on this story and the interview of this top executive, I proposed engrained ethical theory, which posited that company ethics could become second nature to employees as a part of organizational culture and company DNA (Dunn 2013).10 The culture of a company or the “way we do things around here” is a vital component to the sustainability of the company. Company ethical values should be culturalized, a part of company DNA, and engrained in employee thinking in order for all personnel to act ethically, as second nature, without debate.
The path to engrained ethics is set through the evaluation, creation, and implementation of an organization-specific CEMS. When the framework of the MM is utilized and implemented, even with selected, organization-specific components, the opportunity for a cultural change is imminent.
The MM is a research-based, consistent component system that enables the design of ethical workplaces to ensure a culture and an environment of ethical behavior. Though not yet deductively tested in organizations, it was created based on extensive research in the ethical leadership literature and from rigorous qualitative research (with some degree of quantitative analysis in descriptive statistics) in three diverse organizations, represented by various sizes, sectors, and industries. The framework for the flexible model came directly from the executive interview already mentioned. However, the component parts of the MM came from a synthesis of all research elements to fit with a priori (prior existence) and emerging theories and ethical concepts. The placement of specific ethical leadership and management components into the flexible framework of the MM was a laborious but enjoyable task.
It is my hope and trust that this book gives you and your company guidance to the formation of your own unique CEMS. It is also my hope that the MM helps you design an ethical workplace in which company ethics become the norm of practice and become engrained in your company’s culture.
Chapter 7: Workplace Application Exercises
1. Please send Dr. Don Dunn, [email protected], your completed CEMS for possible inclusion in future editions of this book.
2. After you have implemented and practiced your organization-specific CEMS for 6 months, what ethical behavioral changes have you noticed? Please send a report of the perceived effectiveness of your application of the MM to Dr. Don Dunn at [email protected].
3. What critique or additions could you make to the MM? If you have suggestions, please send those to Dr. Don Dunn, [email protected].
Notes
1. Pfeffer, “Hard Facts” 14.
2. Pfeffer, “Hard Facts,” 29.
3. Rost, “Leadership for the Twenty-First Century,” 95.
4. Dunn, “The Moldable Model,” 190.
5. Dunn, “The Moldable Model,” 193.
6. Baucus, “Designing Ethical Organizations,” 355.
7. Baucus, “Designing Ethical Organizations,” 355.
8. Sekerka, “Organizational Ethics Education and Training,” 77.
9. Dunn, “The Moldable Model,” 123.
10. 1Dunn, “The Moldable Model,” 198.