Sales Ethics: Its Not An Oxymoron

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Sales Ethics Its Not An Oxymoron
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Corporations Today

• Corporations, by charter, are immortal.
• Corporations have multiple relationships that
  they are unlikely to keep secret very long.
• www.sec.gov/edgar.shtml
• Magnified for media companies, because revenue
  depends on
• Advertisers
• Subscribers

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Advertisers

• Large advertisers such as Verizon, PG, and
  Coca-Cola will be around for decades.
• Its not smart business to bite the hands that
  will feed your company for the next several
  decades.
• Dont lie to them or cheat them.
• Advertisers dont buy from companies they dont
  trust

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Current Headlines

• The press loves stories about corporate
  dishonesty.
• Enron
• WorldCom
• Ogilvy Mather over-billed the governments
  Office of National Drug Control.
• Five bankers fired from Barkley Bank for spending
  62,200 on dinner for themselves.
• Bear Stearns hedge fund managers lied to
  investors.
• Bernie Madoff

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Whats Going On?

• People perhaps dont know or dont care about
  business standards or ethics.
• People are perhaps greedy.
• People perhaps go along with unethical behavior
  because
• If I dont take their money someone else will.
• No one will know.

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Rationalization

• Criminals and other sociopaths typically
  rationalize their behavior with if I dont take
  their money, someone else will.
• A salesperson for a major media company forged a
  clients name on a contract, but got caught when
  the client got a bill and said, We didnt sign
  anything!
• The salesperson thought no one will know I
  wont get caught.

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Three Reasons

• There are many reasons for unethical behavior,
  but three common ones are
• Strong tendency to bow to authority and follow
  orders just following orders.
• Strong tendency to do what peer group doessocial
  pressure and conformity everyone does it.
• An absence of clearly defined and communicated
  standards nobody told me.

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• Bow to authority.
• People give up their individual free will and
  autonomy and turn their conscience over to
  someone else.
• Nazis at Nuremburg trials said, just following
  orders.
• Cave in to peer pressure in order to conform.
• People negate their free will and autonomy and
  hand over their individuality to the crowd.
• Individuals have a conscience, the crowd, a mob,
  doesnt
• There are an absence of standards.
• Organizations must create and communicate ethical
  standards to trump the nobody told me copout.
• We all know what were supposed to do.

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Why the Ethical Lapses?

• Sociopath, narcissist, excessive greed, or other
  personality defects?
• Perhaps due to extreme pressure from management?
• Perhaps because of an absence of clearly defined
  and communicated standards or a code of ethics?

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Ethics - Definition

• Clearly defined standards of right and wrong set
  out by written codes or standards by a company
• Individual standards of right and wrong based on
• Deep-seated personal values
• Accepted beliefs and modes of conduct by groups
  in which people choose to work and play

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• With heightened press coverage of business
  scandals
• The public has become increasingly concerned
  about ethical behavior
• Now, more than ever is the time to follow Peter
  Druckers sage advice
• It is more important to do the right thing than
  to do things right.

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Salespersons Five Areas of Ethical Responsibility

• To consumers
• Customers buy a product or service.
• Consumers use a product.
• In some businesses (retail, utilities,
  transportation, e.g.) the customer and the
  consumer are the same
• In other businesses (CPG, media, e.g.) they are
  different
• Audience/readers/subscribers consumers
• Advertisers customers

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Salespersons Five Areas of Ethical Responsibility

• To consumers (audience/subscribers)
• Put consumers first.
• Dont lie to them.
• Dont sell them shoddy products.
• Dont sell unsafe products.
• Dont accept advertising for products you
  wouldnt recommend to a relative.

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Salespersons Five Areas of Ethical Responsibility

• To their conscience
• Doing whats right according to ones own moral
  standards.
• There is no pillow as soft as a clear
  conscience.
• Doing the right thing increases self-esteem,
  self-image, and self-confidence.
• Greed is a cancer that will kill a persons and a
  companys reputation and eventually kill the
  organism.

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Reputation

• A companys most valuable asset is its reputation.

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• Some people are unethical because they believe
  they wont get caught.
• But they are playing an ethical lottery with the
  odds of losing extremely high.
• Doing the right thing every business day is the
  only sure way of not getting caught and of
  maintaining a reputation and the self-esteem that
  goes along with an excellent reputation.

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Salespersons Five Areas of Ethical Responsibility

• To customers
• Customers (advertisers) dont buy from people and
  companies they dont trust.
• Under-promise and over-deliver.
• Dont sell customers
• Something they dont need
• Something they cant afford
• Something that doesnt work

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• Dont accept advertising
• That is in bad taste
• That hurts a customers image
• That is misleading
• Salespeople shouldnt
• Give kickbacks
• Use bait-and-switch tactics
• Let customers feel like they lost a negotiation
• Reveal information before a campaign runs or
  reveal competitive information

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• Salespeople shouldnt
• Promise what advertising itself cannot deliver.
• The media can deliver potential exposure to an
  audience
• Cant promise results too many uncontrollable
  factors
• Promise something they cant deliver
• Promotions
• Merchandising
• Tickets
• Position
• Placements
• Completion of schedules

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Salespersons Five Areas of Ethical Responsibility

• To the community
• The global community
• The world community, society
• Do no harm
• Suppose everybody in the world did this?
• The business community
• To maintain faith in the free-market system
• Investors, regulators, general public
• Suppose everybody in business did this?

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Salespersons Five Areas of Ethical Responsibility

• An industry community
• The advertising-supported media
• Americans get their news and often their values,
  beliefs, and attitudes from the media.
• The media altered peoples view of the world and
  their prejudices because they were free of
  government and special-interest-group control.
• Salespeople have a responsibility to keep the
  media free by fueling it in part or in whole with
  advertising.
• Protect democracy.
• A local community
• Dont foul your nest or cheat your neighbor.
• Broadcasters get licenses to serve the community.

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Salespersons Five Areas of Ethical Responsibility

• To their company
• Salespeople represent their company to customers.
• Especially with intangible products, a
  salesperson is the surrogate for the product.
• The salesperson is the company in the eyes of a
  customer.
• A companys credibility depends on the
  salespersons credibility.

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• Rewards to salespeople often unwittingly
  reinforce doing the wrong thing
• Compensation and incentive systems often reward
  getting orders regardless of what is best for
  customers.
• Contests often reward non-customer-centric
  behavior.
• Bonuses for making budgets regardless of what is
  reasonable can cause unethical sales practices.

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• CFOs or top management sometimes recommend
  accounting practices that preserve a companys
  assets.
• Too often they have the wrong assets in mind.
• A companys and a salespersons most precious
  asset is an excellent reputation.
• Protect these reputations by always doing the
  right thing.

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The Ethical Hierarchy

• The Five Cs
• Consumers
• Conscience
• Community
• Customers
• Company

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Ethics Check

• Is it legal?
• Laws
• Regulations
• Company policy
• Is it fair?
• To both sides
• To all stakeholders
• What does my conscience say?

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Ethics

• The New Golden Rule
• Do unto customers as they would have others do
  unto them (not you).
• Kants Categorical Imperative
• Act on the premise that the choices you make will
  become universal law for all people for all
  time.