3 Sources of Values

• Learning Outcome
• Introduction to value system Importance of values
• Values and skills
• Significance of values
• Management theories and corresponding value system
• Summary

1. LEARNING OUTCOMES

• After studying this module, students will be able to understand:
• Meaning of human values Nature of human values Prominent human values Functions of human values
• Importance of human values in business organization

INTRODUCTION TO VALUE SYSTEM:

All the other systems of society are in a way or other dependent on value system. The main aim of today’s society is to earn more money by any means be it fair or foul. It is assumed to be natural human tendency that money leads to greed which further leads to unethical plotting like corruption, scams, frauds etc. In the growing business world where earning profit is the ultimate goal, also not only earning profit but gaining it as fast as possible has lead to use of shortcuts rather than undergoing long cherished ethical value system by the business organizations. In today’s competitive economy led by market value system is showing continuous degradation putting values at back end which is leading to multiple problems in the socio economic system. Corruption has become uncontrollable and the unethical means are adopted to accumulate money in faster ways.

The use of unethical means is leading to unfair business transactions and corporate affairs. Thus to protect and preserve ethical management of business system we need to solidify our value system.

Core of value system is built by commitment, integrity, teamwork, positive attitude, development of people and focus on every customer.

Concept of values

We can lay the foundation of ethical business with the study of value system. Thus value teaching must be included in every management courses of universities and colleges to teach business and corporate ethics to students of management courses to nourish young generation of budding entrepreneurs and managers with strong value system. This will affect the decision making of the mangers in future and benefit the society. Values make the decisions more ethical, kind and humane.

In today’s business world we can see many examples where business based on morals and ethics have cultivated more wealth. Business tycoons like Bill Gates of Microsoft, Azim Premji of Wipro, Mark Zuckerberg of Facebook, Tim Cook of Apple Inc., Warren Buffet of Berkshire Hathaway, Larry Erison of Oracle, Narayan Murthy of Infosys etc. have brought about changes in ethical values of business world by following proper ethical path and are thus promoting corporate social responsibility.

Elements of Values

Every person has a set of different values but only these values highlights human behavior and conduct in day to day activities. These values are also helpful in business interactions in any corporate organization. Values are inner core conduct personally and socially preferable. Various members of a specific culture share lasting beliefs about what is good or bad or desirable or undesirable which are considered as values. Values are base of skills , many times people have value system of their own as one person may consider honesty over wealth while some might consider wealth over honesty.

Scope of values:

Values make whole belief system of a person, they are like the guiding light that makes a person’s behavior throughout his lifetime. Values make basic structure of any organization. Values of a person are developed by the company he holds with him which starts at home, parents teaches the first values to any individual followed by teachers in schools. Values are very important factor in decision making which highlights the right path if right values are given.

Scope of values is not only limited to business world but applies to all disciplines and are studied in fields like religion, law, politics, economics , sociology, humanities, psychology and morality etc. Value system has evolved from the philosophical studies from the time of Aristotle and Plato and economic philosophy of Adam Smith which was in his book “Wealth of nations”. Plato studied value through a question “Is a thing esteemed because it is good or it is good because it is esteemed.” He himself gave the answer that good is independent of appreciation. Thus use of values in business and economics makes it appreciable or desirable. In business system different factors are assigned values and it is chosen on basis of values assigned. It is responsibility of business organizations to provide good values to its customers, suppliers, shareholders, workers, employees, distributors and most important the customers.

Functional Dimension of Values

Values take an individual towards a positive path in society. These not only make our belief system but also give direction to our objectives in life. Values focus on ‘what ought to be’ rather than ‘what is’ , thus they give more importance on ethical behavior. They express the social action. We decide what is good, proper, correct, desired, important, worth and bad, improper, wrong, undesired, unimportant on basis of our values. Behavior of a person is formed by attitude which is a result of perception made by our beliefs , we know value shapes our belief system thus behavior of a person is dependent on the values. Values solve the basic human problems as why to do something, what to do and in what order to do them.

Philosophical Dimension of values

The study of value is termed as ‘Axiology’. Axiology is derived from Greek words ‘axios’ and ‘logos’ which means worthy and science respectively. Study of values is thus science of goodness. ‘Economic value’ term was coined in nineteenth century by Adam Smith keeping in mind its exchange value.

Sociological perspective of values

The importance of values in society is that it shapes the direction in which society believes and behaves. Sometimes values are considered as simple as interests, attitude, preference whereas sometimes is considered as moral ethics or orientation towards the society. Values are usually considered as good, desirable, worthwhile, proper or bad, undesirable, improper. Many sociologists have given their statements regarding values, M. Haralambos states “a value is belief that something is good and desirable”. Another sociologist R.K. Mukherjee states “values are socially approved desires and goals that are internalized through the power of conditioning, learning or socialization and that become subjective preferences, standards and aspirations. By their nature, all human relations and behavior are embedded in values”. These sociologists emphasized the importance of values.

The economic dimension of values

Value not only means moral ethics but in economic terms value is amount of one commodity which can be exchanged for another commodity. Commodity can be materialistic or non materialistic in nature. Many economists have given their views on values, their relationship with cost. Some of the well known economists who gave their views are Adam Smith, David Ricardo, Alfred Marshall and Karl Marx. Nowadays value of a commodity depends on other factors like labour, material, machinery and technology. Now the value theory is changed and studies determination of value of a commodity. Various business organizations also focus on value theory where pricing of commodities or products is required. Economists Adam Smith and Davis Ricardo explained value theory on basis of cost production. Adam Smith stated that value of product depends on labor whereas Davis Ricardo states that value of product depends on both labor and time involved. The drawback of above explanation is that the effect of demand has been ignored for value. Neo-classicist Marshall later explained this. He also found that customer’s tastes and preferences are reflected by demand which is important dimension of utility. Modern economists whereas concentrated on demand side and gave marginal utility analysis. Some of the modern economists who gave this theory are Stanley Jevans, Carl Manger and Leo Walrus. Thus with introduction of concept of marginal utility economists were divided on basis of classical and modern theory of values. This division was unified by Marshall. The theory given by classical economists was based on cost production focused on supply side in the market whereas the marginal utility theory was concerned with demand side. But for proper study of theory of value we have to take both demand and supply sides. Therefore a partial equilibrium analysis is more important for study of theory of value.

THE IMPORTANCE OF VALUES:

In global economic system values hold extreme importance. Values guide us as what is important in our lives like success or family, and what is not important. For example if someone values family over success he would not be interested in a job which takes more time away from the family. The values within us do not change but as we grow as individuals we gain more knowledge about different aspects and we begin to aspects of life in a different way. As a child one may value friends or family more, while growing up that may change to success over family.

As values are the guiding paths of our lives and specifies a path on which we want to go in life they cannot be ignored. Values are not constant but regardless of that, they hold great importance in our lives. They help us to combine ethics with our personal and social life. With changing era and increase in competition and rapid globalization, the global economic activities have changed. With the globalization and privatization the taste of customers has changed and so is the value system. In today’s business world there is a greater need of value system with recent technology advances.

Moral and ethical values

Moral and ethical values are the mental contents of a person with values. These ethical values are the divine qualities also called ‘gunas’. As we must treat people in the same way we want to be treated for example if want to be treated politely we should talk to people in a polite manner. Similarly in business organization we should not use unfair means or adulteration if we don’t want to use flawed goods. A man with poor character and integrity causes greater harm than the person with poor knowledge, poor performance and lack of judgment and analytical ability. For example a salesman with poor communication skills may cause loss in sales but a salesman who makes false promises may result in poor image of organization which can be fatal for organization in long run. Thus ethical values are nurtured in business world.

VALUES AND SKILLS

Values and skills together form ethical actions that are incurred in life, values are the theoretical aspect whereas skills form the practical aspect together forming correct action. Values guide us as to become a good person whereas skills tell what to do to become a good person. As in a computer system , it is made of two parts software and hardware similarly in value system values are like the software and skills bring about hardware aspect. Purity of soul is brought with values , it is an internal aspect whereas skills are quality of functions we perform which is an external aspect. Values forms the predecessors of skills hence are more important than skills.

Difference between values and skills

As we know values are gained from one’s childhood which remains almost same but skills needs regular up gradation . For example in customer services sometimes there are personalized visits of agents to the customers ,these maybe policy of company but with advancing technology they can use personalized calls or emails which will be up gradation in skills. Some of the major differences between values and skills are values tells us what to become but skills guide us how to become, we can do a work perfectly with combination of values with skills as values act as a base for skills, values deals with internal aspect as it purifies soul whereas skills provides expertise which is external aspect, sometimes skills may cause demotivation or division as one individual may not have equal skills as the other whereas values always unite or bring relatedness. We have constant values but skills may vary with time as one may become better.

Difference between values and attitude

Attitude is a behavior of a person towards a particular object whereas values are the belief system of an individual.

SIGNIFICANCE OF VALUES:

Values as said are the guiding light in a person’s life , they give a direction to person’s decisions. They form the basics of our nature and actions. Values create good business ethics such as good quality service, better communication, excellence and innovation. The managerial qualities and success must also be based on proper value system, as it creates goodwill coordination within organization with better supervision, direction and control. We attain mental, spiritual and emotional peace if we are internally satisfied. As if we succeed in a task we should also be internally satisfied as success becomes complete only when we achieve both internal and external enrichment.

Values and workplace

We have seen nowadays work places are fulfilled with luxuries and comfort , this is because it is very important to create a healthy atmosphere to work within. Value system helps in creating a better work place creating positive atmosphere to work and the output becomes more productive, spiritual, and ethical. But today due to practice of unfair means like corruption, fraud, malpractices, cheating in the work place have led to moral, ethical and spiritual degeneration. A good organization will maintain a good atmosphere to work in thus it might take proper steps to maintain values in work place. Many business tycoons have set an example of fair business and not involving in unfair practices which shows that business based on good value system can also yield good output.

Corporate values

Values based on beliefs like integrity, respect, creativity, courage, loyalty, respect and commitment are the core values of corporate world. Some companies in their tag line uses these words, for example: 1. Microsoft: integrity, honesty, openness, and commitment. 2. IBM: dedication, innovation, trust and responsibility. These words identify the values on which organizations are based and provide an expected code of conduct of an organization.

MANAGEMENT THEORIES AND CORRESPONDING VALUE SYSTEM:

There are four types of ethics theories. We can study relationship between various management theories and ethics theories. These are stated below:

1)  The Rational Goals Theory (Teleological Ethics Theories)

2)  The Internal Process Theory ( Deontological Ethics Theories )

3)  The Human Relations Theory (Virtue Ethics Theories)

4)  The Open Systems Theory (Systems development Ethics Theories)

The Rational Goals Theory:

This theory mainly aims on increasing the productivity of organization. This theory was given in early twentieth century by Fredrick W. Taylor. Fredrick with this theory focused on producer and production. According to this theory organization interacts with its external environment to exchange hence making organization as an open system. In this outcome oriented ethical values are given more importance than ethical values.

The Internal Process theory:

In this theory main focus was laid on the due observance of norms and adherence to rules. This theory was given by Max Weber and Henry Fayol in early twentieth century. This theory considered that to achieve goals an organization should lay stress on strong rules and regulations.

The Human Relations Theory:

This theory was propounded by Elton Mayo in mid twentieth century and it lays stress on value system of managerial department. Manager acts as a mentor having qualities like openness, participation, team building and commitment.

The Open System Theory:

This theory given by Paul Lawrence and Jay Lorsch focused on values like innovation and coordination within a manager. In this manager should bring together both internal and external components of organization hence acts as a glue of organization. This theory gives system oriented ethical values more importance than other ethical values.

Organizational Value System:

To achieve goals and targets different organizations develops different value system of their own. Organizational value systems of India have following features:

1) Cooperation: Cooperation and coordination is always preferred over individual working.

2) Family orientation: A child gets his values from family. In India family serves an important role in an individual’s decision making. The value system is family based in India.

3) Humility and respect for others: Value system in India includes humility and respect for others.

4)  Self management: A person should know how to manage his own life before managing others.

Summary:

All the other systems of society are in a way or other dependent on value system. . In today’s competitive economy led by market value system is showing continuous degradation putting values at back end which is leading to multiple problems in the socio economic system. Core of value system is built by commitment, integrity, teamwork, positive attitude, development of people and focus on every customer.

Value teaching must be included in every management courses of universities and colleges to teach business and corporate ethics to students of management courses to nourish young generation of budding entrepreneurs and managers with strong value system. Scope of values is not only limited to business world but applies to all disciplines and are studied in fields like religion, law, politics, economics , sociology, humanities, psychology and morality etc.

Values solve the basic human problems as why to do something, what to do and in what order to do them. The importance of values in society is that it shapes the direction in which society believes and behaves. Value not only means moral ethics but in economic terms value is amount of one commodity which can be exchanged for another commodity. Moral and ethical values are the mental contents of a person with values. Values and skills together form ethical actions that are incurred in life, values are the theoretical aspect whereas skills form the practical aspect together forming correct action. Values create good business ethics such as good quality service, better communication, excellence and innovation. Value system helps in creating a better work place creating positive atmosphere to work and the output becomes more productive, spiritual, and ethical. Values based on beliefs like integrity, respect, creativity, courage, loyalty, respect and commitment are the core values of corporate world.

There are four types of ethics theories: The Rational Goals Theory (Teleological Ethics Theories), The Internal Process Theory( Deontological Ethics Theories ), The Human Relations Theory (Virtue Ethics Theories), The Open Systems Theory (Systems development Ethics Theories). To achieve goals and targets different organizations develops different value system of their own. Value system of corporate in India includes cooperation, family orientations, and respect to all and self management.

SELF-ASSESSMENT

1.  What do you mean by values? How values shape our psyche and behavior?

2.  Discuss the significance of values in human life.

3.  Explain the relationship between various management theories and ethics theories.

REFERENCES:

• Pramod Sharma, “Business Ethics and Corporate Values: An Indian Perspective” Ravitanaya Publications, Shimla, 2017
• S.K Bhatia, “Business Ethics and Corporate Governance” Deep & Deep Publications, New Delhi, 2004
• A.C. Fernando, “Business Ethics and Corporate Governance” Pearson Publication, 2013 Harris & Hartman, “Organizational Behavior” Jaico Publication House, 2002
• French, Bell & Vohra, “Organization Development” Pearson Prentice Hall Publication, 2009
• S B Gogate, “Human Values & Professional Ethics” Vikas Publishing House, New Delhi, 2011