Ethics: The Foundation For Relationships in Selling: Making Ethical Decisions

ETHICS: THE FOUNDATION FOR
RELATIONSHIPS IN SELLING
Salespeople frequently provide the only link between customers and the firm. Therefore,
the ethical conduct of the salesperson must always be above reproach in order to avoid
tarnishing the image of the firm. Salespeople must operate daily by high ethical
standards, without compromise.
Making Ethical Decisions

 Every day salespeople must judge the rightness or wrongness of their actions.
 Business ethics are the rules that direct your conduct and moral judgments.
 Ethics help translate values into behavior.
 There is no uniform code of ethics for all people.
 Many organizations establish a written code of conduct for their salespeople.
Character Development
Despite growing interest in business ethics, unethical behavior has become all too
common. The current generation of workers may be more tolerant of unethical behavior.
The Erosion of Character

 Several “half-truths” have influenced the erosion of character in the
business community.
 We are only in it for ourselves.
 Corporations exist to maximize shareholder value.
 Companies need to be lean and mean.
 Many business firms are struggling to align their values, ethics, and
principle with the expectations of their salespeople and their customers.
A Personal Code of Ethics That Adds Value

 The apparent decline in moral integrity throughout various segments of
our society has precipitated a concern toward firming up our ethical
standards.
 If the business community cannot police itself, people will look to
government for solutions to the problem.
 General guidelines can be used as a foundation for a personal code of
ethics.
1. Personal selling must be viewed as an exchange of value.
2. Relationships come first, tasks second.
3. Be honest with yourself and others.
FACTORS INFLUENCING THE ETHICS OF SALESPEOPLE
1. Salespeople are continually tempted to compromise ethical standards for short-
term gain.
2. Top management as role model.
3. Company policies and practices.
4. Sales manager as role model.
5. Salesperson’s personal values.
6. Laws, contracts, and agreements.
1) SALESPEOPLE ARE CONTINUALLY TEMPTED TO COMPROMISE

ETHICAL STANDARDS FOR SHORT-TERM GAIN.
1. Temptation to make exaggerated claims about products.
2. Temptation to give gifts to encourage orders, despite company policy to
the contrary.
3. Temptation to coerce or apply undue sales pressure on customers to meet
sales quotas.
4. Temptation to inflate or “pad” business expense account.
2) TOP MANAGEMENT AS ROLE MODEL.

1. Ethical standards filter down from the top of an organization.
2. The moral tone of an organization, as established by management
personnel, is the single most important determinant of employee ethics.
3) COMPANY POLICIES AND PRACTICES.

1. Many business organisations develop written policies that deal with
ethical problem areas; these give direction to all employees and offer a
clear-cut philosophy of how to conduct business transactions. This can
improve financial results.
2. Sharing confidential information.

 Salespeople must preserve the confidentiality of information revealed to
them by customers.
 Confidential information that may be helpful to a competing firm should
not be disclosed.
3. Reciprocity.
 Reciprocity is a mutual exchange of benefits, as when a firm buys
products from its own customers.
 Some business firms actually maintain a policy of reciprocity, although in
some cases reciprocity is not acceptable.
 Business relationships based on reciprocity often have drawbacks.
4. Bribery.
 In some cases, a bribe is wrong from a legal standpoint; in most cases, it is
wrong from an ethical point of view.
5. Gift giving.
 The giving of gifts is sometimes closely related to offering bribes,
although it is a more widespread practice.
 Gifts can be inexpensive tokens of appreciation for business, or expensive
items.
 Guidelines for the giving of gifts:
(1) Do not give gifts before doing business with a customer.
(2) Never give the impression you are “buying” the customer’s
business with gifts.
(3) Customers should have a clear understanding that gifts are
given as tokens of appreciation.
(4) Be sure the gift does not violate the policies of your firm or the
customer’s firm.
6. Entertainment.
 The dividing line between gifts, bribes, and entertainment is often
arbitrary.
 In a few industries, entertainment is seen as the key to obtaining new
accounts.
 Entertainment is a highly individualized process and should be planned
with the personal preferences of the prospect in mind.
7. Business defamation.
 Business slander arises when unfair and untrue oral statements
about a competitor are communicated to a third party, thus
damaging the competitor’s business reputation or the personal
reputation of an individual in that business.
 Business libel may be incurred when an unfair and untrue
statement is written about a competitor and communicated to a
third party, thus damaging the competitor’s business and
reputation.
 Product disparagement occurs when false or deceptive
comparisons or distorted claims are made concerning a
competitor’s product, services, or property.
8. Use of the Internet.

 The Internet can create a number of ethical dilemmas.
 Many companies have developed policies that define permissible
uses of their e-mail system.
Effectiveness of company policies as a deterrent to unethical behavior

depends on two factors:
 The firm’s attitude toward employees who violate these policies.
 The participation and support of the entire sales staff when
developing policies.
4) SALES MANAGER AS ROLE MODEL.
1. The actions of a salesperson often mirror the behavior and expectations of
the sales manager.
 Sales managers provide new salespeople with their first orientation to
company operations.
 They interpret company policy and provide feedback regarding the
salesperson’s work and conduct.
2. If the moral fiber of a sales force begins to deteriorate, the sales manager
must shoulder a great deal of responsibility.
3. Sales managers influence ethical behavior of salespeople by virtue of what
they say and what they do.
5) SALESPERSON’S PERSONAL VALUES.

1. Values represent the ultimate reasons people have for acting as they do.
2. Values serve as a foundation for our attitudes, and our attitudes serve as a
foundation for our behavior.
3. Education and life experiences help people clarify their values.
4. Values can serve as a deterrent to unethical behavior in a selling situation.
5. When salespeople discover a conflict between their value system and that
of their employer, they have three choices:
 Ignore the influence of their values and engage in unethical behavior.
 Voice strong opposition to the practice that is in conflict with their
value system.
 Refuse to compromise their values and be prepared to deal with the
consequences.
6) LAWS, CONTRACTS, AND AGREEMENTS.

1. Legal standard is enforced by statute.
2. Ethical standard is an outgrowth of the customs and attitudes of the
society.
3. Nearly all sales activities are subject to regulation.
 A legal guide to a wide range of transactions between the seller and
the buyer, dealing with:
(1) Definition of a sale.
(2) Warranties and guarantees.
(3) Salesperson and the reseller.
(4) Financing of sales.
(5) Product consignment.
4. Defending ethics claims can be costly to a company.
5. Cooling-off laws.
 Legislation that establishes a cooling-off period, during which the
consumer may void a contract to purchase goods or services.
 Provisions of the laws vary from state to state.
 Primary purpose is to provide consumers with an opportunity to
reconsider their buying decision made under the persuasive influence
of a salesperson.
6. Contracts and agreements.
 A contract is simply a promise or promises (oral or written) that the
courts will enforce.
 Salespeople are sometimes the legal representatives of their company
and therefore must be careful when they sign contracts or agreements.
7. Ethics beyond the letter of the law.
 Ethics are not a matter of law alone.
 A salesperson’s ethical sense must extend beyond the legal definition
of what is right and wrong.
 Salespeople must develop their own personal codes of ethics.

Ethics: The Foundation For Relationships in Selling: Making Ethical Decisions

Uploaded by

Copyright:

Available Formats

Ethics: The Foundation For Relationships in Selling: Making Ethical Decisions

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Ethics: The Foundation For Relationships in Selling: Making Ethical Decisions

Uploaded by

Copyright:

Available Formats

ETHICS: THE FOUNDATION FOR

Making Ethical Decisions

The Erosion of Character

A Personal Code of Ethics That Adds Value

1) SALESPEOPLE ARE CONTINUALLY TEMPTED TO COMPROMISE

2) TOP MANAGEMENT AS ROLE MODEL.

3) COMPANY POLICIES AND PRACTICES.

2. Sharing confidential information.

8. Use of the Internet.

Effectiveness of company policies as a deterrent to unethical behavior

5) SALESPERSON’S PERSONAL VALUES.

6) LAWS, CONTRACTS, AND AGREEMENTS.

You might also like