reading response 250+ words

Greetings all!Quote from the article that is attached to support this question, “Does Being Ethical Result in Better Performance?” On page 18 of the text Business ethics: Ethical decision making and cases includes an insert titled Debate Issue Take a Stand. Prepare a whether statement from 1. or 2. and support- Here’s an example to get you started. Whether Ethical businesses are the most profitable. Please note the whether statement is not a question. To begin or respond click on the “Reply” button.Be awesome,Main Post: Always include the writing prompt. Writing prompt: Prepare a short introduction (as if you were going to write a paper). The title of the paper is “Comparisons of Systems Theory and Triple Bottom Line Theory”Both theories are systematic in nature. A small change in one part of the relationship causes change in another part affecting the entire system. Friedman (1970) promotes profit within the “Rules of the Game.” Simple as this may sound various elements make up “Rules of the Game.” Laws, policy, ethics, and historic evolution are parts of, “Rules of the Game.” The rules of the game change. Des Jardin (2005) promotes the three pillars of economically, ecologically and ethically of social responsibility. One’s view point and industry underscores specific priorities and decision-making in relationship to running a business. Profit defined as one goal and supporting the environment a separate goal can be defined as being socially responsible. Attempting to define “Rules of the game” DesJardin (2005) substitutes the words social responsibility with the three pillars and the word sustainability. DesJardin’s (2005) three pillars of sustainability references that business must have all three to be sustaining. Reckless actions harm sustainability and profit making of business. The view that the pursuit of profit is wicked is misplaced, particularly when reviewing the lesson of the “The Parable of the Talents.” (Mathew 25:14-3-; Luke 9:12-28). The Triple Bottom Line Theory is also a System Theory. This short paper will continue to compare the two theories.ReferencesNewton, L.H., Englehardt, E.E., Pritchard, M. (2010). Taking sides: Clashing views in business ethics and society (12th Ed). New York, NY : The McGraw Hill Companies.Hi, Always include the name of person you are addressing. What I do hope to do in this paper is to offer some broad categories for how we might conceptualize business and business ethics in a sustainable future. What would sustainable business, and sustainable business ethics, involve? I also want to suggest some directions, for both business practitioners and academics, in which future work in this area might proceed. But first, let me say a few things about the very notion of sustainability.From Business & Professional Ethics Journal, Vol. 24, Nos. 1 & 2, 2005, pp. 35–59. Copyright © 2005 by Philosophy Documentation Center. Reprinted by permission.Another thought, managers must choose between profit and social responsibility, between their financial duties to their business and their environmental or ethical duties. Cast in these terms, it becomes easy to dismiss both ethical and environmental responsibilities. Pursuing ethical and environmental goals beyond those required by law or minimal moral duties threatens profit, profit is necessary to remain in operation, therefore asking business to pursue environmental goals is unreasonably asking business to jeopardize its very existence.Be Brilliant,
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Total Quality Management
Vol. 21, No. 7, July 2010, 737 –744
Management for sustainability – A stakeholder theory
Rickard Garvare* and Peter Johansson
Quality and Environmental Management, Lulea° University of Technology, Lulea°, Sweden
This paper presents a conceptual model of stakeholder management and expands upon
the relationship between organisational sustainability and global sustainability. The
theoretical discussions have been inspired and deducted from theory on stakeholders,
quality management and sustainability. A model is developed that takes account of
practical and theoretical implications of stakeholder-oriented management in pursuit
of organisational and global sustainability. The model might be used to explain
actual behaviour of organisations and the distinction between organisational and
global sustainability.
Keywords: sustainable development; quality management; stakeholder theory
Introduction
Long-term balance between all interests implies a steady state, where both humans and
nature thrive. A widely accepted notion is that this requires widespread economic
prosperity as well as shared environmental and social concern. Our total economic activities must add enough value to guarantee everybody a decent life without damaging the
ecological system in such a way that the survival of future generations is endangered,
that is global sustainability. Issues of global sustainability affects and should, therefore,
also be important to all types of organisations.
To survive in the long-term in a volatile and uncertain environment, that is achieve
organisational sustainability, contemporary organisations must satisfy a variety of stakeholders, who are all capable of inflicting unacceptable damage on the viability of the
organisation if their interests are not met. Depending on the type of organisation these
stakeholders may include customers, co-workers, suppliers, financiers, owners or
members of various other pressure groups (Freeman, 1984; Konzelmann et al., 2005;
Schilling, 2000; Sharma & Starik, 2004; Wheeler & Sillanpa¨a¨, 1997; Wreder et al., 2009).
The notion of ‘stakeholder management’ for organisational sustainability has been
described as an organisation behaving in such a way as to satisfy the needs and expectations of its stakeholders. According to Foley (2005), the aim of organisational sustainability will be accomplished if organisations act to maximise the quality of their
products to customers, subject to meeting the wants and expectations of non-customer
stakeholders. This perspective reflects a change in the traditional conception of corporate
purpose; moreover, it reflects a fundamental advance on the criteria for management
within the contemporary quality movement. Indeed, according to Radder (1998) and
Foster and Jonker (2003), these developments represent a ‘third generation’ in the
evolution of quality management.
*
Corresponding author. Email: rickard.garvare@ltu.se
ISSN 1478-3363 print/ISSN 1478-3371 online
# 2010 Taylor & Francis
DOI: 10.1080/14783363.2010.483095
http://www.informaworld.com
738 R. Garvare and P. Johansson
Sachs and Ru¨hli (2005) indicate that the concept of stakeholder management,
including its practical implementation, is still relatively unexplored. There is a growing
awareness that an enlargement of the focus from ‘customers’ to the wider concept of
‘stakeholders’ has meant that a considerable portion of quality-management theory
might well be applicable to sustainability-oriented management (Baumgartner, 2003;
Edgeman & Hensler, 2005; Garvare & Isaksson, 2001; Isaksson & Garvare, 2003;
Klefsjo¨ et al., 2008).
It is the contention of the present study that a deeper understanding of the implications
of stakeholder management and sustainability requires: (i) an appropriate categorisation of
stakeholders and interested parties; and (ii) a clear distinction between organisational
sustainability and global sustainability. The aims of the present paper are, therefore, to
present a conceptual model of stakeholder management and to expand upon the
relationship between organisational sustainability and global sustainability.
The idea of incorporating sustainability and quality management is not new, see
Ahmed (2001) and Stead and Stead (2004). However, the present paper adapts a partly
different point of view. The theoretical discussions, as well as the development of
stakeholder theory, have been deducted from the seminal work presented by Foley
(2005). Also, relations between organisational and global sustainability are emphasised
and an all-embracive stakeholder model is presented.
Stakeholder management
The idea of managing stakeholder relationships has been discussed already by Follett
(1941), although Freeman (1984) is often credited with introducing the stakeholder
concept into academic discourse (Schilling, 2000). In a wide sense, ‘stakeholders’ have
been defined as all those who can affect, or are affected by, the achievement of organisational objectives (Freeman & Reed, 1983). However, Foley defines stakeholders in
more specific terms such as:
. . . those entities and/or issues, which a business identifies from the universe of all who are
interested in and/or affected by the activities or existence of that business, and are capable
of causing the enterprise to fail, or could cause unacceptable levels of damage, if their
needs are not met. (Foley, 2005, p. 138, emphasis in original)
According to this view, stakeholders are distinguished from other affected or interested
parties in having both: (i) the means of bringing attention to their needs; and (ii) the
ability to take action if those needs are not met (Foley, 2005).
Some authors suggest that the degree of importance of different stakeholders and
stakeholder interests can vary with respect to different aspects, for instance regarding to
their power or legitimacy in a specific context of market or political system, on the
level of moral development or according to a prioritisation of human rights. Mitchell
et al. (1997) use the attributes of power, legitimacy and urgency to define stakeholders.
The present paper adopts a definition of stakeholders along the lines suggested by
Foley (2005). However, with the exception that an entity or issue must not have been
identified by an organisation for it to be considered a stakeholder, stakeholders are
posited in the present study as being actors that: (i) provide essential means of support
required by an organisation; and (ii) could withdraw their support if their wants or expectations are not met, thus causing the organisation to fail, or inflicting unacceptable levels of
damage. The central aspect of this definition is that it enables a distinction to be made
between parties who have significant influence on an organisation and those who do
not. Although the definition adopted here does not require a stakeholder to be identified
Total Quality Management 739
by the organisation to be categorised as such, organisations will behave in such a way as to
satisfy the wants and expectations of those it does identify as being its stakeholders.
However, it should be noted that to identify a stakeholder is to interpret and understand
a relationship, rather than to identify an actor (Lozano, 2005).
The list of stakeholders of a particular organisation can vary over time and is
dependant on factors that determine the prevailing power balance among various
parties, such as culture, type of market, and government system. Inspired by Wheeler
and Sillanpa¨a¨ (1997) we would like to suggest that the term ‘primary stakeholder’
should be used to describe actors that have direct control of essential means of support
required by the organisation. Depending on the context, examples of such ‘primary stakeholders’ could include customers, management, co-workers, suppliers, shareholders, and
government. The term ‘secondary stakeholder’ is used in the present study to describe
actors that do not directly provide any essential means of support for the organisation,
but still have enough influence to merit being considered more than just interested
parties. These ‘secondary stakeholders’ can include non-government organisations,
academics, media, fair-trade bodies, environmental pressure groups, and other individuals
or organisations that, in one way or another, if their wants and expectations are too heavily
violated, are able to influence primary stakeholders to withdraw essential support, thereby
causing the organisation to fail, or inflicting unacceptable levels of damage.
In our view, ‘stakeholders’ can be distinguished from other ‘interested parties’ in that
the former have the ability to take action if their needs are not met. In contrast, ‘interested
parties’ are those that have an interest in the organisational activities, output or outcome,
but these parties are not capable of significantly influencing the state of the organisation or
its stakeholders. For their needs to be considered, these ‘interested parties’ need to amplify
their influence on fully-fledged stakeholders.
The present study also uses the terms ‘overt stakeholders’ to describe stakeholders that
are known to the management of the organisation and ‘latent stakeholders’ to describe
stakeholders that are not known to the management of the organisation. These categories
of actors are summarised in Figure 1.
Organisational sustainability
Adapting the present stakeholder definition, every organisation has to satisfy the demands
of its stakeholders. For many organisations, especially business organisations, the
Figure 1. Categorisation of stakeholders and interested parties.
740 R. Garvare and P. Johansson
customers provide the revenue necessary to satisfy the other stakeholders. Our view is in
the lines of Foley (2005), who considers the customers as the foremost stakeholder among
equals. To gain competitive advantages, it is clear that the customers have an important
and complex role for most organisations. In quality management, this customer focus is
well developed; see for instance Palmberg and Garvare (2006). According to Bergman
and Klefsjo¨ (2003), the aim of quality management is to satisfy or preferably exceed
the needs and expectations of the customers with a reduced amount of resources.
Various definitions of the term ‘customer’ have been suggested in the literature. The
ISO 9001 standard provides a narrow definition of a ‘customer’ as an ‘organization or
person that receives a product’. However, in the criteria for the Malcolm Baldrige National
Quality Award (NIST, 2006, p. 66) ‘customers’ are defined more broadly in terms of ‘an
actual or potential user of [an organisation’s] products and services’. The Swedish Institute
for Quality (SIQ, 2002, p. 6) refers to a ‘customer’ as the person an organisation ‘exists to
serve’. Bergman and Klefsjo¨ (2003, p. 27) describe a ‘customer’ as the person for whom an
organisation wishes to ‘create value’. The concept of value is related here to the value
chains and not to the financial chains in the organisation. Ishikawa (1985, p. 107)
coined the phrase: ‘The next process is your customer’. Juran (1999, p. 2.3) defines a
customer even more broadly as ‘. . . anyone who is affected by the product or by the
process used to produce the product’.
For the purposes of the present paper, customers are broadly defined as individuals or
organisations that are downstream in the life cycle process of a product,1 that is, customers
are receivers of a product. Individuals or organisations that are upstream in the same
process, that is, the providers of the product are referred to as ‘suppliers’. Customers
and suppliers can be ‘internal’ or ‘external’, depending on the organisational boundaries
of the actual process. In cases in which organisations are dependant on the input of
natural resources, the natural environment can be regarded as a ‘supplier’.
Against this backdrop our contention is that the aim of quality management is to
satisfy, or preferably exceed, the wants and expectations of the customers subject to
meeting the demands of the other stakeholders, in order to fulfil the aim of the organisation. It is noticeable that this stakeholder orientation is a constraint on the traditional
customer focus of quality management.
Global sustainability
If an organisation manages to endlessly satisfy or exceed the demands of its stakeholders,
it will be sustainable. However, organisational sustainability does not necessarily imply
global sustainability, to some extent because the timeframes are different and also
because the interests of different parties are involved. Global sustainability involves a
timeframe measured in centuries, whereas corporations tend to focus most of their
energies on activities in the immediate future. Moreover, global sustainability involves
the interests of future generations and the natural environment, whereas organisational
sustainability tends to involve only primary and secondary stakeholders.
According to Meadows et al. (1972), the priority accorded to various dimensions of
sustainability is determined by the speed of feedback and personal closeness. Given that
the feedback and closeness of some actors are relatively delayed and distant, the influence
of these actors is likely to be reduced, and they are thus more likely to be viewed as mere
‘interested parties’, rather than as stakeholders.
As long as some interests are treated as negligible because these actors have a lack of
power or because their feedback is delayed, a sustainable balance is unlikely to be reached.
Total Quality Management 741
The present study contends that global sustainability requires more than formal conformity
with legal contracts of obligation; it also requires personal commitment to conform with
universal moral principles of justice (Kohlberg et al., 1983) and acceptance of the notion of
stewardship (Edgeman & Hensler, 2001).
Global sustainability has been defined by the World Commission on Environment and
Development (WCED, 1987, p. 54) as ‘development that meets the needs of the present
without compromising the ability of future generations to meet their needs.’ In terms of
stakeholder theory, this implies that organisations should not only fulfil the wants and
expectations of their stakeholders, but also avoid actions that reduce the ability of
interested parties, including future generations, to meet their needs.2 This might be said
to represent an anthropocentric view of sustainability where it is the ability to meet the
human needs that should not be compromised. The actors and their influence on global
sustainability and organisational sustainability are illustrated in Figure 2.
Summary of the theory
It is clear that there is a connection between the degree of global sustainability promotion
and the range of actors that the organisation responds to. This relation between sustainability, stakeholder theory and quality management is can still be developed. Our intention
is to present a logical model that explains the organisations relation to global and organisational sustainability. In conclusion, our theory of stakeholder management is based on
the following definitions and usages:
Stakeholders are considered to be actors that: (i) provide essential means of support required
by an organisation; and (ii) could withdraw their support if their wants or expectations are not
met, thus causing the organisation to fail, or inflicting unacceptable levels of damage.
Interested parties are all actors with any interest in the organisational activities, output, or
outcome, but who do not possess the power or instruments to influence the state of the organisation or its stakeholders.3
Deriving from Foley’s (2005) theory of meta management, we would like to suggest that:
Figure 2. Actors and their influence on global sustainability and organisational sustainability.
742 R. Garvare and P. Johansson
Organisations4 will behave in such a way as to satisfy the wants and expectations of those it
identifies as its stakeholders.
Organisational sustainability will be achieved if the organisation manages to endlessly satisfy
or exceed the demands of its stakeholders.
Finally, we want to add to this theory a tentative part relating to the issue of global
sustainability:
Global sustainability will be promoted if organisational sustainability is achieved without
compromising the ability of interested parties to meet their needs, both present and future.
In summary, organisational excellence, in terms of promoting both organisational and
global sustainability, implies that the organisation should aim to satisfy, or preferably
exceed, the wants and expectations of its stakeholders without compromising the ability
of other parties to meet their needs.
Discussion
Drawing on the literature, the present paper has presented a conceptual model of organisational sustainability and global sustainability that incorporates elements of stakeholder
theory and quality management.
It is apparent that a considerable difference exists between current organisational
behaviour and the proposed requirements for global sustainability. A deduction of our
tentative theory for global sustainability might therefore be that this world will not be
successful in the long-term. The same certainly holds for organisations. Many organisations fail and, as a result, they are put out of business. Nonetheless, despite this quite
large gap between actual and required behaviour currently, it can be argued that all
actors have a moral obligation to strive for global sustainability. In this regard, it is
important to strengthen the position of interested parties that are not stakeholders.
Standardisation, legislation, and increased transparency might all contribute to this.
The importance of the identification of stakeholders needs to be emphasised. An organisation can fail if an actor who is actually a stakeholder is identified as a mere ‘interested
party’ and if corporate activities oppose this stakeholder’s interests. Conversely, if the
organisation identifies actors as stakeholders when, in fact, these actors do not provide
any essential means of support or are incapable of withdrawing these means, the allocation
of resources might be less than optimal when viewed from an organisational perspective.
According to the proposed theory, organisational sustainability will be achieved if the
organisation manages to endlessly satisfy or exceed the demands of its stakeholders.
Stakeholder satisfaction could be viewed here as a quotient between delivery and
demands, where organisational sustainability is strengthened when: (i) organisational
delivery, that is the quality of output to stakeholders, increases; or (ii) stakeholder
demands on the organisation decrease, thereby reducing the constraints.
Furthermore, this study has argued that an organisation should satisfy, or preferably
exceed, the wants and expectations of its customers subject to meeting the demands of
its other stakeholders. The appropriateness of the term wants is not self-evident.
Bergman and Klefsjo¨ (2003), for example, preferred the term needs. However, the
present paper argues that most business organisations can prosper by satisfying the
wants and expectations of its customers, but that these ‘wants’ might be in conflict with
the actual needs of these customers. As a contrasting example, public healthcare
organisations should attend to the needs of their customers, rather than what they think
they want. Thus, it is apparent that the terms ‘wants’ or ‘needs’ should be used with
Total Quality Management 743
discretion, depending on the context of a particular organisation. Moreover, it is suggested
that the term ‘demand’ should be used to indicate the lowest acceptable leve …
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