Week 6 Business Negotiation Discussion Due March 6

Week 6 business Negotiation discussion Due Friday, March 6, 2015 · Ethics

Consider the scenario presented on page 171 of your textbook: You are a vice president of human resources, negotiating with a union representative for a new labor contract. The union refuses to sign a new contract unless the company agrees to raise the number of paid holidays from six to seven. Management estimates it will cost approximately $220,000 for each paid holiday, and argues that the company cannot afford to meet the demand. However, you know that, in reality, money is not the issue – the company simply doesn’t think the union's demand is justified. To convince the union leaders that they should withdraw their demand, you have been considering these alternatives: (a) tell the union that the company simply can’t afford it, without further explanation; (b) prepare erroneous financial statements that show that it will cost about $300,000 per paid holiday, which you simply can’t afford; and (c) offer union leaders an all-expenses-paid “working” trip to a Florida resort if they will simply drop the demand.

Employing one of the four approaches to ethical reasoning presented in the text, justify or criticize each of the three alternatives.

Paper For Above instruction

Ethical considerations play a crucial role in negotiations, especially when decisions involve financial disclosures and the principles of honesty, fairness, and integrity. The scenario involving a human resources vice president negotiating with a union representative highlights the importance of ethical reasoning in complex bargaining situations. It presents three different strategies to influence the union’s decision: outright honesty about the company's inability to meet demands, falsification of financial information, and offering an incentive through an all-expenses-paid trip. Analyzing these strategies through the lens of ethical reasoning provides insight into their morality and potential consequences.

Utilitarianism and the Alternatives

Utilitarianism, as an ethical framework, assesses the morality of actions based on their outcomes, emphasizing the greatest good for the greatest number (Mill, 1863). Applied to the scenario, the company’s first alternative, truthfully stating that it cannot afford the increase in paid holidays, aligns with utilitarian principles if it leads to a balanced and sustainable resolution that ultimately benefits all stakeholders, including employees, management, and shareholders. Although it may cause short-term dissatisfaction, honesty fosters trust, facilitates cooperation, and reduces the risk of future legal or ethical repercussions that falsification could invite.

The second alternative, falsifying financial statements to justify refusing the demand, clearly violates utilitarian principles. While it might produce a short-term benefit for management by avoiding costs, the long-term consequences—such as loss of trust, reputational damage, and potential legal penalties—far outweigh initial gains. Such deception can diminish overall welfare and erode stakeholder confidence, ultimately producing a detrimental outcome for the organization and its employees (Schweber & Dogan, 2020).

The third alternative—offering an all-expenses-paid trip—raises questions about manipulation and coercion. Though it might persuade the union to drop their demand, it also risks exploiting the union leaders’ interests and could be viewed as an unethical inducement. From a utilitarian perspective, if this tactic results in a superficial agreement lacking genuine consensus, the potential for future conflict or dissatisfaction may outweigh the immediate benefit, making this strategy ethically questionable.

Kantian Ethics and Moral Duty

Kantian ethics emphasizes acting according to principles that can be universally applied, grounded in duty and respect for persons (Kant, 1785). From this perspective, honesty is a moral duty. The first alternative, transparently communicating the company's financial constraints, conforms to Kantian principles as it respects the union leaders' capacity to make informed decisions based on truthful information.

In contrast, falsifying financial statements breaches the Kantian imperative to act according to principles that could be universally adopted without contradiction. It treats the union leaders merely as means to an end—the end being avoiding costs—rather than respecting their autonomy and capacity for honest negotiation. Similarly, offering a paid trip as an incentive manipulates the union leaders, risking their autonomy and reducing them to pawns in a transactional game, which Kantian ethics strictly condemn.

Virtue Ethics Perspective

Virtue ethics, focusing on character and moral virtues, advocates for actions that reflect honesty, integrity, fairness, and prudence (Aristotle, 4th century BCE). From this viewpoint, the first alternative demonstrates virtues of honesty and integrity, fostering trust and respect in workplace relationships. Conversely, falsification and offering incentives for dishonest cooperation violate virtues such as honesty, fairness, and courage.

Choosing transparency aligns with fostering a virtuous character that values truthfulness and fairness, essential qualities for sustainable relationships. Conversely, deception and manipulation reveal character flaws—dishonesty and lack of integrity—that can harm organizational culture and stakeholder trust over time.

Conclusion

Analyzing the three alternatives through multiple ethical frameworks reveals that honesty—both in transparency and truthful financial reporting—is paramount. While the company’s first approach aligns with the moral principles of utilitarianism, Kantian ethics, and virtue ethics, the other two alternatives embody unethical practices with potentially serious consequences. Ethical negotiation requires integrity, respect for others’ autonomy, and a commitment to truthful communication, thus fostering trust and long-term success.

References

• Aristotle. (4th century BCE). Nicomachean Ethics.
• Kant, I. (1785). Groundwork of the Metaphysics of Morals.
• Mill, J. S. (1863). Utilitarianism.
• Schweber, S., & Dogan, M. (2020). Ethical Decision-Making in Business: Theory and Practice. Journal of Business Ethics, 162(2), 321-337.
• Thompson, L. (2015). Negotiation Genius. Harvard Business Review Press.
• Schein, E. H. (2010). Organizational Culture and Leadership. Jossey-Bass.
• Fisher, R., Ury, W., & Patton, B. (2011). Getting to Yes: Negotiating Agreement Without Giving In. Penguin Books.
• Rawls, J. (1971). A Theory of Justice. Harvard University Press.
• Heuer, R., & Pham, P. (2019). Business Ethics and Corporate Responsibility. Routledge.
• Freeman, R. E. (1984). Strategic Management: A Stakeholder Approach. Pitman.