Lesson 4 Ethics in Sales Management

Course Code and Title: MKTE.
5 SALES MANAGEMENT
Lesson Number: WEEK 4
Topic: Ethics in Sales Management
Introduction:
Salespeople are, for the most part, caring, ethical professionals. They encounter ethical
challenges because of their job, including how to handle unethical request from
customers and making sure that they know and follow all company policies for
interacting with customers. Sales managers have all the usual management concerns,
such as fair hiring practices. Managers also have to develop policies and practices that
codify ethical behaviors, train salespeople on the ethics policies, and ensure that
policies are followed.
Learning Objectives:
1. Identify factors associated with ethical constraints.
2. Define and understand the sales code of conduct.
Explain the following words
1. Closing
2. Presentation
3. Approach
4. Prospect
5. Qualified prospect
Lesson :
ETHICAL CHALENGES AMONG SALESPEOPLE
 Complete Product Knowledge – Greater consumer preference can mean that

products are better customized for individual. However, it can also raise the
possibility of consumer confusion. Salespeople must be able to educate consumers
to help the latter make informed decisions so that they feel comfortable. When a
salesperson understands something completely, he can adapt his sales presentation
to better suit his prospect’s needs.
 Mispresentation – While salespeople are no doubt thinking, “this topic doesn’t apply
to me; I would never mispresent anything”, consider always that mispresentation can
happen inadverdently. Consumer question should be responded accurately and
clearly in language that the consumer will understand in order to help avoid
unintentional mispresentation.
 Disclosures – Failure to reveal on the part of the sales person may not only cause
mistrust to his customers, but it also can lead to ethical issues or regulatory action.
The contract a customer signs is a legal document, which is intended to protect the
rights all parties, including the customers and the salesperson. Of course the
customer is held responsible for what he is signing.
 Sales product sales vs. overall strategy – It is vital to get complete picture for the
prospect’s history, lifestyle, attitudes, and resources in order to recommend the right
product for the right individual. A salesperson must not just walk into a presentation
with one product he is planning to sell. When this done he simply sells a product not
essentially a solution. He cannot make a product recommendation without
understanding with his client is trying to accomplish.
 Keeping up with compliance – For many salespeople the understandable source of
their frustration is the apparently never ending levels of compliance procedures and
paperwork involved in the sale of a simple product. However, the solid foundation of
compliance proves the ethical business practices of the companies whose they
represent.
PROFFESIONAL CONDUCT
1. Competition – While allowing companies that compete earn an appropriate return on

their investment, healthy competition delivers added value to customers. Supporting
fair competition, competing on the basis of truthfully representing products and
services in the marketplace and fulfilling obligations in good faith are some ethical
behavior in a competitive environment.
2. Pricing – Prices have to be transparent without hidden charges. This is a way of

following ethical guidelines in pricing. The consumer has to know how much he is
going to pay when he purchases a product of avails of service. Prices have to reflect
both the cost the company incurs in delivering the product of service and the value
the customer expects to receive.
3. Products – Ethical sales and marketing recommend only safe and sound products
which are appropriate for their planned use. Supply of the product consist of
providing instructions that the customer can follow up to make the product work as
intended. Following these guidelines is a sound business practice because it
increases customer satisfaction.
4. Research – During sales activity and marketing research businesses get hold of
personal information, it is ethical to practice the privacy of customers will be
respected and their data will be safe guarded. Market researchers need to follow
privacy legislation and inform their customers that they are collecting their data. Let
them know the purpose, use the data only for that purpose and destroy it securely if
it is no longer needed.
5. Promotion – Sales and marketing consist of promoting products and services to

prospective customers. Ethical promotion portrays offers truthfully and correctly, with
no links to nice looking lifestyles that are not applicable. Salespeople have to
promote their product and services based on their own qualities and emphasize
those features that a target market might find valuable when promoting to that
market segment.
MANAGING AN ETHICAL WORK CLIMATE

Different types of ethical work climate
1. Instrumental – The Chief Executive Officer CEO of a company creates an
instrumental ethical climate by managing using ethical egotism. The firm feels that it
has every right to make selfish decision to make decision that will benefit the
company or even him personally. He even sabotaged one of his competitor’s sales
events so that they would take a hit in corporate morale. This type of ethical climate
has the highest amount of immoral and unethical business behavior due to self -
interest being the driving factor in decision making.
2. Caring –This climate follows the opposite type of instrumental standards because it
believes in a caring ethical environment .A caring climate is based where the
employees are sincere in the well- being of others inside and outside of the
organization. The CEO is concerned with the employees welfare and offers support
in career development. The ethical climate is based on excellent leadership,
goodness and fairness. Employees can thrive in this ethical type of environment
because there is an excellent communication between the superiors and
subordinates, but there are times that this is neglected because we want to help
friends or employees.
3. Law and order – Is when the precise codes of conduct are followed. This type of
climate follows the laws from outside sources, usually government laws.
Conservative types of company usually follows this law because they fear of legal
ramification if they do not follow. This type of climate can tend to ignore employee
issues and only concerned about specific codes.
4. Rules – This type of ethical climate is similar to law in order it is concerned with
following rules, procedures, and policies established by the organization. The
difference to the law of climate is that rules just relies on internal codes or policies on
internal professional codes or policies. Employees even managers understand that
varying from the rules can cost their them their job.this can restraint creativity and
legitimate issues might be ignored.
5. Independence – This type of ethical climate is the opposite of rules climate, ethical
climate promotes independence and gives employees to make decisions. This can
cause great success because employees are able to think outside the box for
solving problem, especially if given the skills and information needed.
Activity/Evaluation: Enumerate
1. What are the ethical work climate and explain
2. What are ethical sales issues?
Reinforcement:
1. What are the three biggest ethical challenges in sales?
2.Why you need to be honest and ethical when you do sales?
3.What types of sales behavior are unethical?

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Course Code and Title: MKTE.

Explain the following words

ETHICAL CHALENGES AMONG SALESPEOPLE

 Complete Product Knowledge – Greater consumer preference can mean that

1. Competition – While allowing companies that compete earn an appropriate return on

2. Pricing – Prices have to be transparent without hidden charges. This is a way of

5. Promotion – Sales and marketing consist of promoting products and services to

MANAGING AN ETHICAL WORK CLIMATE

1. What are the ethical work climate and explain

2. What are ethical sales issues?

1. What are the three biggest ethical challenges in sales?

2.Why you need to be honest and ethical when you do sales?

3.What types of sales behavior are unethical?

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