Leadership Case Study: Part A - Ethical Dilemmas and Whistleblowing

This case study delves into ethical dilemmas within an organization, focusing on the actions of senior management and the behavior of a new manager. It explores recommendations for senior management, emphasizing the importance of ethical leadership, clear principles, open communication, and teamwork. The analysis examines the unethical behavior of the new manager, highlighting a lack of qualifications, poor decision-making, and disregard for ethical conduct. The case study also investigates the benefits and drawbacks of whistleblowing for the organization, community, and individuals, emphasizing its role in promoting ethics and transparency. The document references various academic sources to support its analysis.

Running Head: PART A
LEADERSHIP CASE STUDY: PART A

2PART A
Answer 1. Recommendations for actions for the senior management
The case study shows time the management seems to be corrupt and unethical which is
producing a crisis for the organization. They are constantly losing their revenues and it might
lead to the shutting down of the organization. So in order to bounce back from the situation,
there are some recommendations for the senior management that are mentioned below which
might come in the rescue:
 Choosing an ethical leader: As the managers are the ones who are actually guiding the
organization so it is very important to understand and chose an ethically correct person as
a manager. Zhang et al. (2016) opined if the leader of the organization is morally correct
then he or she will definitely follow the principles of the organization and lead the
employees towards the common goal. It is also important for managers to understand the
work properly to increase productivity. Ethical leadership not only brings financial and
strategic success but it also guides the organization towards a greater good.
 Setting up clear principles: Xu et al. (2016) stated for an organization to grow it is very
important for the organization to set up clear principles or guidelines which has to be
followed by all the members of the organization irrespective of their position. Suppose in
this case the manager took an important decision all by himself and pushed the company
towards huge loss. So to avoid such instances it is important for the organization to
mandate rules and regulations before taking any kind of decision on behalf of the
organization. So proper guidelines will ensure that everyone is working as per the ethics
of the organization.
 Open communication: In this case, it is clearly evident that there was no communication
between the management and even among the managers. According to Vasu et al. (2017),
communication is a very important aspect of business and open communication has to be
encouraged. It’s not just the managers who have to discuss their work plans but they also
should be transparent in front of the employees as well. Efficient communication will
help in reducing the misunderstanding among the employees which in time will help to
improve the business (Ho et al. 2015). Moreover, open communication also helps in
taking the correct decision for the organization where the pros and cons are discussed by
the whole management and not just a single individual.

3PART A
 Focus on teamwork: Huhtala et al. (2015) mentioned that it is very important that the
employees work together as a team and help each other in achieving the common goal.
This will help the organization to come back from loses and make a stable ground for
themselves.
Answer 2. Ethics of the new manager's behaviour
Ethics can basically be defined as the nature or behaviour of a person so in this case there
are certain traits or characteristics that can be observed in the new manager's behaviour. In this
situation primarily the manager was not qualified enough for the job. Most of the staffs in this
organization has been working for more than 20 years and they demanded an engineer as their
manager but in return, their new manager was an accountant (Lavena, 2016). It became difficult
for the new manager to keep hold of the business and just because of the lack of his experience
the sales started to fail and gradually the business became slow. It showed that the new manager
lacked leadership skills so instead of taking the reign of the situation he completely lost control
(Vasu et al. 2017). The business became so bad that it almost came to a point of shutting down
the door, which will lead to huge unemployment for the loyal employees as well as a number of
apprentices who were working in the shop. Another instance shows how much irresponsible and
careless the new manager was when a huge contract was to be put on a tender but during this
time the manager went on a holiday. Later it was discovered that the new manager went to the
trip that was sponsored by one of the companies tendering for the contract to supply the raw
materials. This clearly indicated the unethical behaviour as the leader of the employees.
The new manager had no control and supervision among the employees working. The
new manager also went onto various trips and in one of such trips in Melbourne, he went to see a
machine worth thousands of dollars. He was not travelling with any of the supervisor and before
buying such an expensive machine he did not even consult with anyone. But after he arrived with
the machine it was discovered that the machine had no particular use in the whole shop.
Although the machine was of the state of the art it was not compatible with the shop. In order to
make it worthy they needed to spend more money on changing the present machines in the shop.
This was the ultimate evidence that how much unethical the new manager was and had no sense
of any managerial skills.

4PART A
Answer 3. Benefits and drawbacks of whistleblowing for the organization, community and
the individual
Every organization aspires to have employees who are hardworking as well as ethically
correct. Ethics guides the employees to work in a certain way and follow the rules and
regulations (Near and Miceli, 2016). The practice of whistle-blowing in an organization
promotes ethics and transparency in the business. It also helps to ensure clear and open
communication among the employees. The most important job of whistle-blowing in an
organization is maintaining the reputation of the organization and protecting their clients (Kumar
and Santoro, 2017). So, in this case, the whistleblowers were the ones who helped in informing
the senior management that something was going wrong in the shop. They suspected
inappropriate behaviour among the employees which triggered an investigation. These were
several employees who were suspected and charged of theft from the shop resulting in
imprisonment.
Whistle-blowing works anonymously and provide confidential services, as a result, any
employee can come and point out what is going wrong in an organization. Liu et al. (2018)
opined that there is fear of losing a job for the employees if they point out what is inappropriate
for the organization. So with the whistleblower's policy, the employees can stay anonymous and
share the information which might be very vital for the organization. So, in this case, the
unethical practices of several employees came out because of the whistleblowers. The pointing
of inappropriate behaviour in the organization led to an investigation and finally punishing the
culprits.
Lin et al. (2016) stated that a corrupt organization which is set up in society will actually
hamper the advantage for the employees. Corrupt leaders in the organization just look for the
personal gains and benefits, as a result, the demands of the employees are never met. So the duty
of the whistleblowers is to make sure that the management stays ethically correct and also thinks
about their employees and also the customers. An organization is established in society and it is
generally the local people who come to work. If an organization is corrupt then it is definitely
going to affect the people working there (Davis et al. 2017). In this scenario, it is observed that
because of the corrupt employees the shop is running in a loss and the employees are working
without any certainty of days or situation.

5PART A

6PART A
References
Davis, R.S., Stazyk, E.C. and Klingeman, C.M., 2017. Accounting for personal disposition and
organizational context: connecting role ambiguity, public service motivation, and whistle-
blowing in federal agencies. The International Journal of Human Resource Management, pp.1-
20.
Ho, S.S., Li, A.Y., Tam, K. and Zhang, F., 2015. CEO gender, ethical leadership, and accounting
conservatism. Journal of Business Ethics, 127(2), pp.351-370.
Huhtala, M., Tolvanen, A., Mauno, S. and Feldt, T., 2015. The associations between ethical
organizational culture, burnout, and engagement: A multilevel study. Journal of Business and
Psychology, 30(2), pp.399-414.
Kumar, M. and Santoro, D., 2017. A justification of whistleblowing. Philosophy & Social
Criticism, 43(7), pp.669-684.
Lavena, C.F., 2016. Whistle-blowing: individual and organizational determinants of the decision
to report wrongdoing in the federal government. The American Review of Public
Administration, 46(1), pp.113-136.
Lin, S.H.J., Ma, J. and Johnson, R.E., 2016. When ethical leader behavior breaks bad: How
ethical leader behavior can turn abusive via ego depletion and moral licensing. Journal of
Applied Psychology, 101(6), p.815.
Liu, Y., Zhao, S., Li, R., Zhou, L. and Tian, F., 2018. The relationship between organizational
identification and internal whistle-blowing: the joint moderating effects of perceived ethical
climate and proactive personality. Review of Managerial Science, 12(1), pp.113-134.
Near, J.P. and Miceli, M.P., 2016. After the wrongdoing: What managers should know about
whistleblowing. Business Horizons, 59(1), pp.105-114.
Vasu, M.L., Stewart, D.W. and Garson, G.D., 2017. Organizational Behavior and Public
Management, Revised and Expanded. Routledge.

7PART A
Xu, A.J., Loi, R. and Ngo, H.Y., 2016. Ethical leadership behavior and employee justice
perceptions: The mediating role of trust in organization. Journal of Business Ethics, 134(3),
pp.493-504.
Zhang, F.W., Liao, J.Q. and Yuan, J.M., 2016. Ethical leadership and whistleblowing: Collective
moral potency and personal identification as mediators. Social Behavior and Personality: an
international journal, 44(7), pp.1223-1231.