Sales Management Ethics
Recently, there are many discussion about whether sales ethic is an oxymoron or not. The definition of oxymoron itself is a figure of speech in which apparently contradictory terms appear in conjunction (Oxford dictionaries, accessed 21 March, http://oxforddictionaries. com/definition/oxymoron? q=oxymoron). Businesses who involved in unethical behaviour, such as Enron and Martha Stewart will cause harm to themselves. Unethical behaviour lead to many negative impacts for the company itself, for instance, the increase regulation of business and the declining of stakeholder confidence to the company.
One aspect of the business which is vulnerable of unethical behaviour is the area of personal selling (Pettijohn, Keith, and Burnett 2011, 134). Otherwise, there is also a perspective which see sales and ethics are contradict. Thus, a salesperson cannot sell a product in an ethical way due to the desire of profit. Ethic, Business Ethic, and Sales Management Ethics Ethic is the individual’s personal beliefs regarding what is right and wrong or good or bad (Fisher 2004, 392). Ethic can also be regarded as a set of moral principles or values.
Moral conduct refers to what which relates to principles of right and wrong in behavior. Furthermore, business ethic is concerned with good and bad or right
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Salespeople are the most important part to determine whether sales process runs in ethical way or not since they are the boundary spanner or people in the middle (Lysonski and Johnson 1983, 8). Boundary Spanner is someone who performs his or her job in the boundary between a company and a customer (Hair et al. 2010, 30). Sales ethic is not an oxymoron Nowadays, many people think that sales ethic is an oxymoron, but actually they can belong together and support each other, even, it can make the company stand in the god light in front of its stakeholders.
There are some reasons why sales ethics is not an oxymoron.
Firstly, sales ethics preserve legitimacy. If a company’s product are considered illegitimate, it is problematic to keep them on the market, especially when the salespeople misleading the consumer about the product safety by withholding the truthful information. For instance, when Dow Corning was accused of putting a breast implant in the market which is dangerous for woman health, the effects of Dow Corning’s bottom line were negative. Read about the business and society relationship
The company’s stock fell by 15% despite the fact that implants represented only 1 percent of its revenue. Dow Corning now has been forced to declare bankruptcy (Marcus 1996, 114). Secondly, sales ethics also matters because it promote trust. Trust is conceptualized as an expectancy held by an individual or group that the word, promise, written or verbal statement of another party can be relied on (Ganesan and Hess 1997, 440).
According to Strutton, Petton and Lumpkin (1993, 1), it is imperative that sales people gain and maintain the trust of prospect customer and clients.
Once trust has been built between the customer and the seller, the connection between them will change from the transactional base to the relationship base (Murphy, Laczniak, and Wood 2007, 45). This changes will allow salespeople to be more involved with each customer, have a greater knowledge of consumer and generally provides greater flexibility in making decision that enchance customer satisfaction. Trust also can generate the repeat buying from consumer. Thirdly, ethical behaviour in sales will bring a positive effect on the long term profitability (Herndon, Fraedrich and Quey 2001, 73).
The formation of ethical behaviour of salespeople can begin from inside the organisation with building the ethical climate. According to Ming and Chia (2005, 54), creating an ethical culture within an organization may provide ethical standard for its members. Ethical climate will generate less stress among the sales people. Policies and rules will reduce ambiguity and the salespeople will likely to know how to respond to the ethical problem. Then, When there is a trust between sales manager and sales people, there will be less conflict.
For Instance, Diageo PLC, the leading of spirits and alcoholic beverage producer has gain the trust from the government and also from the consumer due to the clean and ethical image (Corporate watch UK 2005). In the short term, unethical behaviour, such as abusive labour contracts, fraud, bribes and emezzlement can lead to profits more readily that fairness can, but almost always end up being detrimental in the long run. In some cases, such practices can even lead to costly legal penalties.
If a public scandal ensues, the loss of reputation can be dramatic, as well as the investment of much time and money, might be necessary to recover credibility and trust (Mele 2009, 12). One can argue that acting ethically might mean some additional cost. Investing in worker safety could lead to a loss in competitiveness if one’s rival fail to do likewise. Laws and the reinforcement can help to avoid such situation but, if this is not the case, sales manager should do their best. Competent sales managers will seek to run business that are both ethical and profitable (Mele 2009, 13).