MGT610 GDB solution 2020

MGT610 GDB

Discuss how utilitarianism and cultural relativism guide the managers to make business decision.

Utilitarianism

Individual Self-interest. When individuals are deciding what to do for themselves alone, they consider only their own utility. For example, if you are choosing ice cream for yourself, the utilitarian view is that you should choose the flavour that will give you the most pleasure.

When faced with a decision, a utilitarian asks, “How does the action relate to everyone who is affected by it? If it is beneficial to the majority, then it is right. If it is detrimental to the majority, then it is wrong.” Utilitarian’s tend to reason as follows: “I strongly believe that x is the best decision because the consequences benefit the greatest number of people.”

Concern as to how an act affects the general welfare is often considered to be a higher stage of moral reasoning than is cultural relativism. In this sense, the individual is not just concerned about following national laws, but about whether the law is morally justified when the well-being of others is considered. Utilitarian emphasize the consequences of an action on all those affected by it. During the middle Ages, political and economic policies were legislated that primarily served the interests of the ruling mon- arch’s family. In the 18th and 19th centuries, the philosophers Jeremy Bentham and John Stuart Mill37 countered that what mattered most was the greatest good for the greatest number of people. In On Liberty, Mill argued that the greatest good for political arrangements entailed respecting every person’s liberty, not just that of the monarchy or parliament.38 Ethical conduct is that which creates the most good in the world, provided that the liberty of others is not violated. In the United States, utilitarianism is a foundational ethic for the nation’s political, economic, and business systems. Democracy is justified on utilitarian grounds in the sense that the policy chosen is that which the majority of voters desire. Capitalism is justified on utilitarian grounds because the pursuit of economic self-interest improves national wealth. Business decisions based on cost–benefit analysis are also grounded in utilitarian logic. Organizations need managers who are utilitarian, always looking after what is best for the organization and broader society. As a predominant ethical theory, however, utilitarianism can be problematic for organizations. For instance, to avoid bankruptcy, utilitarian managers could decide to save money by eliminating costly safety protections that benefit only a few maintenance workers. Utilitarian seeking a reasonable solution to these issues will usually broaden their conceptualization of “greater good” to include human rights or undertake actions that they would want everyone to do, thereby taking the next step up the moral reasoning ladder.

Culture relativism

Cultural relativism is the idea that a person's beliefs, values, and practices should be understood based on that person's own culture, rather than be judged against the criteria of another.
National laws and norms matter a great deal for cultural relativists. Laws are established through two distinct processes, Congress and the judicial system, that mediate individual and social group differences. Political legislation is the result of Democrats and Republicans representing their group’s interests and then, by voting, reaching a conclusion binding on everyone. Judicial laws are the result of lawyers presenting competing perspectives and reaching a decision binding on everyone. Cultural relativism is also a rather common ethical theory. Many managers do not want to break the   law, even when doing so might personally benefit them or their company. Managers want to do what is right in the eyes of the legal establishment. When problems arise, they ask company lawyers to provide a legal opinion. Organizations need managers who are cultural relativists, adamant that local, state, and federal laws be obeyed. As a predominant ethical theory, however, cultural relativism can be problematic for organizations. Just because something is legal does not mean that it is ethical. Until midway through the Civil War, businesses could legally use slave labour in the United States, but doing so was unethical because it violated individual liberty. Similarly, just because an organization has the legal right to pollute up to a certain amount does not mean it should, particularly if available pollution controls are not burdensome. Cultural relativists seeking a reasonable solution to these dilemmas will usually broaden their
consciousness to considering the greatest good for the greatest number of people affected, individual rights, or virtuous behaviour, which are the three final steps up the moral reasoning ladder. These three ethical theories are aimed at minimizing the most common human biased a preference for self- interests, group interests, and national interests.