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Running Head:Management theory and practicesManagement theory and practicesName of the StudentName of the UniversityAuthor Note
1MANAGEMENT THEORY AND PRACTICESThe concept of ethics in business should be integrated in all aspects of operation. Ethicsrefers to abstract concepts derived from the theology, professional societies and philosophy,which define the right and wrong behaviour Crane & Matten (2016). Ethical decision should betaken for an organisation that would regulate the organisational behaviour. A business canintegrate the profit making goals with the social goals of management. Social goals emerge fromthe obligations of the business towards social responsibility. A multinational organisation canface many ethical dilemmas which can be understood by recognising the ethical obligation of abusiness. Ethical decisions are necessary for the future development of the organisation bygaining the competitive advantage (Dion, 2012). The aim of the assignment is to identify theethical dilemma faced by an organisation that is in news since last two years. In response to theethical dilemma, the theoretical concepts from the managerial ethics are used to discuss the issuecritically. The essay cortically evaluates how these theoretical concepts influence the managerialpractices in the chosen organisation. For this purpose, 7-Eleven company is chosen and ethicaldilemma pertains to the Australian franchised stores of this company. Based on thoroughliterature review on how ethical decisions can be made. In conclusion, the essay critically reflectson how the leaders may ensure organisational decisions are made ethically.The organisation that is chosen for the critical analysis of the ethical dilemma is 7-Elevenwith the focus on the company’s Australian franchised stores. In Australia the first 7-Eleven wasopened in 1977 in Melbourne. 7-Eleven is the American-Japanese organisation. It is theinternational chain of convenience stores that franchises, operates and licenses more than fiftythousand stores in 18 countries. The company in the US sells partially frozen soft drink namedSlurpee. It also sells Big Gulp beverages. Other products of this company are carbonatedbeverages, energy drinks, coffee, 7-Selectprivate-brand products,bakery items,fresh fruit,
2MANAGEMENT THEORY AND PRACTICESsalads, fresh sandwiches that are daily made, Bakery items, dairy products, product deliveryservice and the financial services (Fraser, 2016).In Australia the majority of the stores of 7-Eleven are located in the central businessdistrict areas of metropolitan cities. These stores in Australia sell wide range of productsincluding drinks, confectionery, snack foods, daily newspapers, gift cards, three types of visacards. There are a total of 75 7-Eleven stores established in Australia. Majority of the storeslocated in the suburban areas are the petrol stations having the central admission. These storesare operated as franchisee (About Us - 7-Eleven Corporate, 2017). Since, the last two years, theorganisation is in news due to unethical operations and is discussed in subsequent sections.In 2015, the joint investigation conducted by the Fairfax and the ABC Four corner,revealed that 7-Eleven’s Australian franchised stores is engaged in unethical employmentpractices. As per the investigation, there is strong evidence on the underpayment of staff (7-Eleven Wage Scandal Reflects Corporate Irresponsibility, 2017). The employees were forced towork for long hours. For international students, there is a rule of investing 20 hours per work.These students were afraid to complain about the wage theft to the Fair Work Australia, as theywere blackmailed about visa cancellation on the ground of breach of regulations. As per theinvestigation, this issue was prevalent since six years and went unreported. Inspite of the strongevidence the company argues that this use was faced by employees of small number ofFranchisees. The wage theft was mainly experienced by the migrant workers in Australia. Thejoint investigation thus concluded that the franchisee business model cannot work in Australia asthey are unable to pay according to the Australian Law of payment (Ferguson et al., 2015).
3MANAGEMENT THEORY AND PRACTICES7-Eleven Australian stores wok as 365 days business. Therefore, the wages that are to bepaid to the employees should be significant. The scenario was however opposite. The storeswork 24 hours every day and yet the total wage given to the six staff as per the documentedfinancial statement showed $64,000. As per the law the payment of each employee per hourshould be A$24.69. 7-Eleven Australian stores was paying its staff around A$10-A$14 per hour(Gartrell, 2016). It was evident that the company had no other option but to underpay its staff tomaintain its position in Australia. If 7-Eleven had to follow the law, then it must compromise onprofit. Further, detailed investigation into the matter showed that there was serious manipulationof the records of the employee working hours. The employees were even deprived of legalentitlements of the penalty rates for overtime, public holidays, and others. The issue wasinvestigated by theAllan Fels, who is the chairman ofAustralian Competition and ConsumerCommission. As the consequence of the overall investigation, Russ Withers (the chairman) andWarren Wilmon (chief executive), resigned from 7-Eleven. Therefore, this is the case of theethical failure of leadership and led to lawsuit against the organisation(Planforpersonalsuccess.com, 2017). Highlighting the ethical dilemma faced by the chosenorganisation, the essay further aims to discuss the theoretical concepts of managerial ethics inthis regard.Managerial ethics refers to set of principles that define the wrong and right operations ofbusiness, and helps analyse the situation of conflict (Dion, 2012). There are several definitions ofEthics. It is not merely adhering to law and it is seen as beyond this obedience. May it bebusiness or a –eleven is the personal work the virtue of honesty is essential. The unethicalbusiness operations of 7-Eleven clearly indicate the conflict between the business ethics and the