Introduction
Corporate ethics is one of the many components that make up a company. Significant corporations worldwide follow the norms and criteria set out by their administrations. Those rules describe how activities are managed, executed, and managed but do not embody the organization’s ethical views. Many government-imposed legal restrictions exclude a company’s moral principles. Organizational ethics influence the decisions and actions of what is fair and unfair.
So far, the general structures of an organization have been typically based on the corporation’s management’s purpose and objectives. This has also been predicated on how these objectives correspond to the externally and internally operating environment. In most firms, there are two types of organizational structures to consider. The first is the formal-based organizational structure, comprising grouping or designating personnel according to their role within the company. The formal system mainly focuses on morals and how the staff is anticipated to interact with one another and fulfill specific jobs inside the firm. On the other hand, the informal-based structure is more challenging to establish but entails a greater emphasis on communicating, interacting and creating more relationships inside the business.
An organization’s cultures are essential features that integrate the organization’s principles and values with the workers’ beliefs in creating a positive working environment centered on the company’s overall success while benefiting the employees. The ethical principles are usually rules established by the management, and they give staff the appropriate requirement of the company to encourage growth and success. A constructive and moral culture should form an efficient working environment. This paper, therefore, aims to provide a comprehensive literature review of how culture and ethics influence the structure of a company. The paper will further provide detailed literature discussing how organizational ethics and culture create a secure basis for employees and companies in immoral circumstances.
Organizational Culture
Organizational solid cultures can always have a beneficial or harmful influence on a company’s performance. According to Al-Jabari and Ghazzawi (2019), culture can be represented in two aspects: underlying ideals and visible symbols. Examples of such observable characters include behaviors, clothing, and physical locations. Beliefs, emotions, attitudes, and ethics would constitute underlying assumptions. On the other hand, Ceylan and Dul (2022) state that organizational culture gives employees a sense of belonging to the company and produces values that apply to that company’s identity. Worker observations influence how the cultures of a business are viewed. Managers and supervisors must create an organizational structure for workers to attach to the concrete culture, as evidenced by the literature presented below.
Types Of Organisational Cultures
The various kinds of organizational cultures can either foster collaboration or isolate employees. However, there will be four types of corporate culture explored in this literature review: Achievement Culture, Adaptability, Bureaucratic, and Clan. Each category has characteristics in common and aids in the company’s overall performance.
Achievement Culture
The goal of achievement cultures is to promote good performance for the company to succeed. According to research by Chernov and Mardanov (2019), the fundamental vision based on the company’s success goals is to aid realize the purpose that characterizes the achievement cultures. Companies with an accomplishment culture are those whose primary goal is to achieve profitable growth. According to Klein et al. (2019), achievement cultures exist in some companies, including Amazon. Amazon aspires to become a pioneer in customer-based service and adheres to the principle that the consumer has always been right.
Adaptability
An adaptable company necessitates flexibility, creativity, and reactivity. Adaptability cultures can be defined as emphasizing external influences via transformation and flexibility to fulfil customers’ needs. Organizations like Apple and Google are thought to be flexible as they implement change in response to external factors and encourage risk-taking and creativity in their everyday operations (Chernov & Mardanov, 2019). Le Coze (2019) demonstrated flexibility by conducting research that influenced the sustainability of culture through digital transformation. As per the report, digital transformations have been a problem for many businesses, but it is vital for developing their culture.
Bureaucratic
It is practising bureaucratic culture whenever an organization concentrates on a systematic and procedural adherence to typical business operations. As per Le Coze (2019), workers have little say in day-to-day operations, and the emphasis is exclusively on c conformity and consistency. Bureaucratic culture always persists, even though most firms are moving further away from this culture because of the more critical requirement for flexibility. Oyemomi et al. (2019) investigated the link between ethical conduct and management principles. Bureaucratic culture is primarily concerned with a managerial hierarchy, which includes guidelines and restrictions that influence ethical conduct. Employees are managed through guidelines and policies under hierarchical control.
Clan Culture
Clan culture becomes another organizational culture that promotes structural designs. Clan culture emphasizes the organization’s membership’ needs and involvement. Clan cultures are based on the principle that money spent on personnel will be re-invested in the organization. Southwest Airlines is the epitome of clan-based culture. As per a study conducted by Qing et al. (2020), Southwest takes pride in prioritizing its workers and, as a result, redistributes to its stockholders. According to the findings by Qing et al. (2020), team-based organizational culture is learned and adopted by associates, and it creates precedence throughout a company,
Organizational Ethics
Organizational ethics can be described as the core principles determining which decisions employees make are correct and incorrect. The way a company offers structure and creates pathways to preserve ethical standards reveals more about the company (Al-Jabari & Ghazzawi, 2019). Whenever ethical difficulties develop, it is never clear what is right and what is wrong. Thus the underlying organizational ethics can be used in decision-making. The conventional method in organizations, like ethical committees, ethics hotlines, and compliance officers, was described by Al-Jabari and Ghazzawi (2019). Since these are standard ways, more adaptive business ethical procedures are needed, like investigating how individuals make choices and why and delving into corporate moral concepts.
Shaping Organizational Ethics
Forming an ethical code is among how an entity can use to establish organizational ethical standards. This is a written statement of the principles, ethical obligations, and values that employees must follow. Ethical codes exist in several forms; some firms refer to them as Codes of Conduct or Corporate Credos. According to Ceylan and Dul (2022), adopting an ethical code focuses on preventing abusing power, which would help many companies. Ceylan and Dul (2022) compared the codes of ethics across Korean and British companies on a qualitative and quantitative level. Whereas Korean companies place a premium on having an ethical code that inhibits power abuse, the British ethical codes did not. According to the study by Ceylan and Dul (2022), national cultures significantly impact organizational ethics and cultures. Understanding cultural variations will lead to a better understanding of how organizations’ bureaucracies and hierarchies vary.
Challenges Towards Shaping of Organizational Ethics and Culture
Various organizations face a variety of cultural and ethical difficulties. Global organizations have cultural and ethical issues due to many markets and cultures, whereas others face stigma. Border relations are an example of global issues that significantly impact corporate ethics and culture, according to Le Coze (2019) and Klein et al. (2019). In collaboration with the “American Nurses Association,” Oyemomi et al. (2019) wrote an article about the ethical challenge of medication errors alongside the cultures of admitting them to healthcare. Oyemomi et al. (2019) composed an article describing the difficulties nurses confront when reporting medication errors and the consequences of medication errors on culture safety. Changes throughout healthcare are created regarding the mistakes and the lessons learned from them.
Whenever the safety cultures are practised among individuals who make mistakes, the number of reports will drop, and no change will be made. The change will never happen if management does not create cultural safety. This is an excellent example of this strategy creating a safe space for people to accept and make corrections from their previous mistakes (Aranki et l., 2019). This same concept was also used by Qing et al. (2020). On the other hand, Qing et al. (2020) dealt with Shamans and lacked leadership experience. On the other hand, Le Coze (2019) focused on cracking the gender barriers and the importance of leadership support towards elevating women.
Organizational Transformations that Reshape Ethics and Culture
As per Marshall (2019), Microsoft’s design group modified the company’s underlying ideas and culture of innovation dedicated to serving customers. The core values were communication, inclusion, listening, and enlightening others. These concepts are good guidelines for bringing change throughout an organizational culture, impacting ethics. However, this is never a research article, and no quantitative data is provided (Khan et al., 2020). It is a fantastic theory for bringing positive change to a company. These are some of the same qualities that Ceylan and Dul (2022) are searching for throughout healthcare to develop such a safety culture.
A variety of factors can influence the ethics and culture of an organization. The correlation between subcontractors and entrepreneurship organizations was investigated by Chernov and Mardanov (2019). The research revealed that subcontractor companies influence the entrepreneur’s culture and that whenever the subcontractor’s culture promotes innovation, so does the entrepreneur’s culture. Yamali (2018) discovered that team-based ethical cultures differed between firms but that manager clarity and consistency promoted ethical cultures inside a company.
Critique
All the literature examined yielded suggestions for future research and gaps in present knowledge. Qing et al. (2020) arguments were not convincing as they claimed that their studies on various ethics and cultures were essential but had not been adequately examined before their research. The restricted time allotted by the corporation they examined was one of the study’s constraints. Per their arguments, it was not convincing as the amount of time provided restricted the number of workers that could participate.
As per the study conducted by Chernov & Mardanov (2019), a few of the shortcomings that have been identified include that few literature sections mentioned the names of the companies or firms that have been evaluated. For instance, they mentioned organizations like Apple and Google practicing adaptability cultures. Most of the study on shaping an organization’s ethics and culture is conceptual, and the results reached are only superficially relevant to an enterprise making their study less convincing.
The study conducted by Chernov and Mardanov (2019) was completed anonymously, and no samples of other organizations’ actions to shape ethics and culture are provided. Other articles lack the history and illustrations of ethics and cultures that Chernov and Mardanov (2019) does. It would be significant to examine investigations on the finer points of ethics and culture within national companies. It would have been much fascinating to survey the Amazon workers on how they feel about the organization they work for and to see if the corporate-level strategy reflects their responses. While finding an institution willing to execute such research may be difficult, companies must be willing to adopt their recommendations someplace; Le Coze (2019) is an example. Le Coze (2019) provide ways to raise the proportion of women on corporation boards, but they do not discuss how to implement their ideas.
Conclusion
Ethics and cultures must be shaped to affect an employee’s performance. While cultures and ethics may seem to be two distinct structural characteristics of a company, research has revealed that they are inextricably linked. The process of a company defining its ethics and culture is complex, yet it enables individuals to establish criteria for the organization’s corporate philosophy. Management and the power to implement the organizational strategies and the structural design define the organizational-based cultures and ethics. The study found that leadership is the most crucial factor in determining ethics and cultures and that poor leadership can contribute to ineffective organizational structures.
With generational growths and developments, as well as the necessity for ongoing innovation in a study on the impact of leadership and molding ethics and culture, more research is required. The growth of research will influence the development of ethics and culture in the future, as well as the advancement of leadership for future generations. There is proof that a firm can form a culture utilizing a well-structured ethical code and surpass profitability targets, and even become such a customer preference by promoting their culture as a component of their company image.
The study has also detailed some of how organizational cultures and ethics influence the structure of an organization by providing the various kinds of organizational cultures with the aid of examples. The paper has also discussed some of the changes in shaping organizational ethics and culture. Whenever the safety cultures are practised among individuals who make mistakes, the number of reports will drop, and no change will be made. Finally, the paper has also discussed some organizational transformations that can aid in shaping the organizational culture and ethics. Some core values that can aid organizational transformations include communication, inclusion, listening, and enlightening others. These concepts are good guidelines for bringing change throughout an organizational culture, impacting ethics.
References
Al-Jabari, B., & Ghazzawi, I. (2019). Organizational commitment: A Review of the conceptual and empirical literature and a research agenda. International Leadership Journal, 11(1). 78–119. Web.
Aranki, D. H., Suifan, T. S., & Sweis, R. J. (2019). The relationship between organizational culture and organizational commitment. Modern Applied Science, 13(4), 137-154.
Ceylan, C., & Dul, J. (2022). The Place to Be: Organizational culture and organizational climate for creativity. In Homo creatives (pp. 137-171). Springer, Cham.
Chernov, S., & Mardanov, I. Postmodern organization theory and concept of managing free enterprises. BBK 65.02 D25, 281.
Khan, M. A., Ismail, F. B., Hussain, A., & Alghazali, B. (2020). The interplay of leadership styles, innovative work behavior, organizational culture, and organizational citizenship behavior. Sage Open, 10(1), 2158244019898264.
Klein, L., Beuren, I. M., & Dal Vesco, D. (2019). Effects of the management control system on unethical behaviors. RASP Management Journal, 54, 54-76.
Le Coze, J. C. (2019). How safety culture can make us think. Safety Science, 118, 221-229.
Oyemomi, O., Liu, S., Neaga, I., Chen, H., & Nakpodia, F. (2019). How cultural impact on knowledge sharing contributes to organizational performance: Using the fsQCA approach. Journal of Business Research, 94, 313-319.
Qing, M., Asif, M., Hussain, A., & Jameel, A. (2020). Exploring the impact of ethical leadership on job satisfaction and organizational commitment in public sector organizations: The mediating role of psychological empowerment. Review of Managerial Science, 14(6), 1405-1432.
Yamali, F. R. (2018). Effect of Compensation, Competencies and Organizational Culture on Organizational Commitment its Implicationson Experts Performance of Construction Services Company in Jambi Province. International Journal of Advances in Management and Economics, 7(2), 29-42. Web.