Skip to main content
SpringerLink
Log in

Communication of Organizational Strategy and Coordinated Decision Making as Catalysts for Enhanced Perceptions of Corporate Ethical Values in a Financial Services Company

  • Published:
Employee Responsibilities and Rights Journal Aims and scope Submit manuscript

Abstract

Drawing upon stakeholder theory and other interactional perspectives, this study explores the linkages among strategy communication, business decisions, and organizational ethics. Using survey data obtained from employees working for a financial services firm operating in the United States, the study determines 1) whether coordinated decision making fully mediates a proposed relationship between the communication of business strategy and employees’ perceptions of corporate ethical values, or 2) whether business strategy communication and coordinated decision making both influence perceived ethical values (partial mediation). Results obtained from structural equation modeling provide strong support for full mediation. The practical/theoretical implications of the findings and future research suggestions are presented.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2
Fig. 3
Fig. 4

Similar content being viewed by others

Notes

  1. Valid percentages presented, which take into account missing data for variables.

References

  • Adams, J., Tashchian, A., & Shore, T. H. (2001). Codes as signals for ethical behavior. Journal of Business Ethics, 29(3), 199–211.

    Article  Google Scholar 

  • Ahmad, S., & Schroeder, R. G. (2003). The impact of human resource management practices on operational performance: recognizing country and industry differences. Journal of Operations Management, 21, 19–43.

    Article  Google Scholar 

  • Anderson, J. C., & Gerbing, D. W. (1988). Structural equation modeling in practice: a review and recommended two-step approach. Psychological Bulletin, 103(3), 411–423.

    Article  Google Scholar 

  • Anh, P. C., & Matsui, Y. (2011). Relationship between quality management information and operational performance. Management Research Review, 34, 519–540.

    Article  Google Scholar 

  • Ansoff, H. I. (1991). Critique of Henry Mintzberg’s ‘The design school: reconsidering the basic premises of strategic management.’. Strategic Management Journal, 12, 449–461.

    Article  Google Scholar 

  • Armstrong, J. S., & Overton, T. S. (1977). Estimating nonresponse bias in mail surveys. Journal of Marketing Research, 14, 396–402.

    Article  Google Scholar 

  • Arthur, H. B. (1984). Making business ethics useful. Strategic Management Journal, 5, 319–333.

    Article  Google Scholar 

  • Barney, J. (1991). Firms resources and sustained competitive advantage. Journal of Management, 17, 99–120.

    Article  Google Scholar 

  • Bates, K. A., Amundson, S. D., Schroeder, R. G., & Morris, W. T. (1995). The crucial interrelationship between manufacturing strategy and organizational culture. Management Science, 41(10), 1565–1580.

    Article  Google Scholar 

  • Bromily, P., & Cummings, L. L. (1992). Transactions costs in organizations with trust. Working paper no. 28. Minneapolis: Strategic Management Research Center, University of Minnesota.

    Google Scholar 

  • Carpenter, M. A., & Sanders, W. G. (2007). Strategic management: A dynamic perspective. Upper Saddle River: Pearson/Prentice Hall.

    Google Scholar 

  • Collier, J., & Esteban, R. (2007). Corporate social responsibility and employee commitment. Business Ethics: A European Review, 16(1), 19–33.

    Article  Google Scholar 

  • Cropanzano, R., Byrne, Z. S., Bobocel, D. R., & Rupp, D. E. (2001). Moral virtues, fairness heuristics, social entities, and other denizens of organizational justice. Journal of Vocational Behavior, 58, 164–209.

    Article  Google Scholar 

  • David, F. R. (1989). How companies define their mission. Long Range Planning, 22(1), 90–97.

    Article  Google Scholar 

  • David, F. R. (2005). Strategic management: Concepts and cases (10th ed.). Upper Saddle River: Pearson/Prentice Hall.

    Google Scholar 

  • Flynn, B. B., & Flynn, E. J. (1999). Information-processing alternatives for coping with manufacturing environment complexity. Decision Sciences, 30, 1021–1052.

    Article  Google Scholar 

  • Flynn, B. B., & Flynn, E. J. (2004). An exploratory study of the nature of cumulative capabilities. Journal of Operations Management, 22, 439–457.

    Article  Google Scholar 

  • Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobserved variables and measurement error. Journal of Marketing Research, 18, 39–50.

    Article  Google Scholar 

  • Fraedrich, J. P., & Ferrell, O. C. (1992). The impact of perceived risk and moral philosophy type on ethical decision making in business organizations. Journal of Business Research, 24, 283–295.

    Article  Google Scholar 

  • Galbraith, J. R. (1973). Designing complex organizations. Reading: Addison-Wesley.

    Google Scholar 

  • Galbraith, J. R. (1974). Organizational design, an information processing view. Interfaces, 4(3), 28–36.

    Article  Google Scholar 

  • Galbraith, J. R. (1977). Organizational design. Reading: Addison-Wesley.

    Google Scholar 

  • Hair, J. F., Anderson, R. E., Tatham, R. L., & Black, W. C. (1998). Multivariate data analysis. New Jersey: Prentice Hall.

    Google Scholar 

  • Hannah, S. T., Avolio, B. J., & Walumbwa, F. O. (2011). Relationships between authentic leadership, moral courage, and ethical and pro-social behaviors. Business Ethics Quarterly, 21(4), 555–578.

    Article  Google Scholar 

  • Hosmer, L. T. (1994). Strategic planning as if ethics mattered. Strategic Management Journal, 15, 17–34.

    Article  Google Scholar 

  • Hosmer, L. T. (1995). Trust: the connecting link between organizational theory and philosophical ethics. Academy of Management Review, 20(2), 379–402.

    Google Scholar 

  • Hosmer, L. T., & Kiewitz, C. (2005). Organizational justice: a behavioral science concept with critical implications for business ethics and stakeholder theory. Business Ethics Quarterly, 15(1), 67–91.

    Article  Google Scholar 

  • Hunt, S. D., Wood, V., & Chonko, L. (1989). Corporate ethical values and organizational commitment in marketing. Journal of Marketing, 53(3), 79–90.

    Article  Google Scholar 

  • Husted, B. W., & Allen, D. B. (2000). Is it ethical to use ethics as strategy? Journal of Business Ethics, 27, 21–31.

    Article  Google Scholar 

  • James, L. R., & Brett, J. M. (1984). Mediators, moderators, and tests for mediation. Journal of Applied Psychology, 69(2), 307–321.

    Article  Google Scholar 

  • James, L. R., Mulaik, S. A., & Brett, J. M. (2006). A tale of two methods. Organizational Research Methods, 9, 233–244.

    Article  Google Scholar 

  • Jones, T. (1991). Ethical decision-making by individuals in organizations: an issue-contingent model. Academy of Management Review, 16(2), 366–395.

    Google Scholar 

  • Koonmee, K., Singhapakdi, A., Virakul, B., & Lee, D. (2010). Ethics institutionalization, quality of work life, and employee job-related outcomes: a survey of human resource managers in Thailand. Journal of Business Research, 63, 20–26.

    Article  Google Scholar 

  • Larson, G. S., & Pepper, G. L. (2003). Strategies for managing multiple organizational identifications: a case of competing identities. Management Communication Quarterly, 16(4), 528–557.

    Article  Google Scholar 

  • Lee, E. M., Park, S., & Lee, H. J. (2013). Employee perception of CSR activities: its antecedents and consequences. Journal of Business Research, 66, 1716–1724.

    Article  Google Scholar 

  • Lin-Hi, N., & Muller, K. (2013). The CSR bottom line: preventing corporate social irresponsibility. Journal of Business Research, 66, 1928–1936.

    Article  Google Scholar 

  • Maritz, R., Pretorius, M., & Plant, K. (2011). Exploring the interface between strategy-making and responsible leadership. Journal of Business Ethics, 98, 101–113.

    Article  Google Scholar 

  • McKnight, D. H., Ahmad, S., & Schroeder, R. G. (2001). When do feedback, incentive control, and autonomy improve morale? The importance of employee-management relationship closeness. Journal of Managerial Issues, 13, 466–482.

    Google Scholar 

  • Miles, M. P., Munilla, L. S., & Darroch, J. (2006). The role of strategic conversations with stakeholders in the formation of corporate social responsibility strategy. Journal of Business Ethics, 69, 195–205.

    Article  Google Scholar 

  • Minoja, M. (2012). Stakeholder management theory, firm strategy, and ambidexterity. Journal of Business Ethics, 109, 67–82.

    Article  Google Scholar 

  • Mintzberg, H. (1990). The design school: reconsidering the basic premises of strategic management. Strategic Management Journal, 11, 171–195.

    Article  Google Scholar 

  • Morita, M., & Flynn, E. J. (1997). The linkage among management systems, practices and behaviour in successful manufacturing strategy. International Journal of Operations and Production Management, 17(10), 967–993.

    Article  Google Scholar 

  • Pearce, J. A., & Robinson, R. B. (2005). Strategic management: Formulation, implementation, and control (9th ed.). New York: McGraw-Hill/Irwin.

    Google Scholar 

  • Podsakoff, P. M., MacKenzie, S. B., Lee, J. Y., & Podsakoff, N. P. (2003). Common method biases in behavioral research: a critical review of the literature and recommended remedies. Journal of Applied Psychology, 88(5), 879–903.

    Article  Google Scholar 

  • Rallapalli, K. C., Vitell, S. J., & Barnes, J. H. (1998). The influence of norms on ethical judgments and intentions: an empirical study of marketing professionals. Journal of Business Research, 43, 157–168.

    Article  Google Scholar 

  • Robin, D. P., Reidenbach, R. E., & Forrest, P. J. (1996). The perceived importance of an ethical issue as an influence on the ethical decision-making of ad managers. Journal of Business Research, 35, 17–28.

    Article  Google Scholar 

  • Rupp, D. E., Ganapathi, J., Aguilera, R. V., & Williams, C. A. (2006). Employee reactions to corporate social responsibility: an organizational justice framework. Journal of Organizational Behavior, 27(4), 537–543.

    Article  Google Scholar 

  • Schneider, B., Ehrhart, M. G., Mayer, D. M., Saltz, J. L., & Niles-Jolly, K. (2005). Understanding organization-customer links in service settings. Academy of Management Journal, 48, 1017–1032.

    Article  Google Scholar 

  • Schroeder, R. G., Bates, K. A., & Junttila, M. A. (2002). A resource-based view of manufacturing strategy and the relationship to manufacturing performance. Strategic Management Journal, 23, 105–117.

    Article  Google Scholar 

  • Schwab, B. (1996). A note on ethics and strategy: do good ethics always make for good business? Strategic Management Journal, 17, 499–500.

    Article  Google Scholar 

  • Schwepker, C. H., Jr. (2001). Ethical climate’s relationship to job satisfaction, organizational commitment, and turnover intention in the salesforce. Journal of Business Research, 54, 39–52.

    Article  Google Scholar 

  • Schwepker, C. H., Jr., & Good, D. J. (2007). Sales management’s influence on employment and training in developing an ethical sales force. Journal of Personal Selling & Sales Management, 27(4), 325–339.

    Article  Google Scholar 

  • Sharma, D., Borna, S., & Stearns, J. M. (2009). An investigation of the effects of corporate ethical values on employee commitment and performance: examining the moderating role of perceived fairness. Journal of Business Ethics, 89, 251–260.

    Article  Google Scholar 

  • Sims, R. R. (1991). The institutionalization of organizational ethics. Journal of Business Ethics, 10, 493–506.

    Article  Google Scholar 

  • Singer, A. E. (1994). Strategy as moral philosophy. Strategic Management Journal, 15, 191–213.

    Article  Google Scholar 

  • Singer, A. E. (2010). Integrating ethics and strategy: a pragmatic approach. Journal of Business Ethics, 92, 479–491.

    Article  Google Scholar 

  • Singhapakdi, A. (1999). Perceived importance of ethics and ethical decisions in marketing. Journal of Business Research, 45, 89–99.

    Article  Google Scholar 

  • Singhapakdi, A., Vitell, S. J., & Kraft, K. L. (1996). Moral intensity and ethical decision-making of marketing professionals. Journal of Business Research, 36, 245–255.

    Article  Google Scholar 

  • Singhapakdi, A., Vitell, S. J., & Franke, G. R. (1999). Antecedents, consequences, and mediating effects of perceived moral intensity and personal moral philosophies. Journal of the Academy of Marketing Science, 27(1), 19–36.

    Article  Google Scholar 

  • Singhapakdi, A., Salyachivin, S., Virakul, B., & Veerayangkur, V. (2000). Some important factors underlying ethical decision making of managers in Thailand. Journal of Business Ethics, 27(3), 271–284.

    Article  Google Scholar 

  • Sorsa, V., Palli, P., & Mikkola, P. (2014). Appropriating the words of strategy in performance appraisal interviews. Management Communication Quarterly, 28(1), 56–83.

    Article  Google Scholar 

  • Thun, J. (2008). Empirical analysis of manufacturing strategy implementation. International Journal of Production Economics, 113, 370–382.

    Article  Google Scholar 

  • Trevino, K. T. (1986). Ethical decision making in organizations: a person-situation interaction model. Academy of Management Review, 11, 601–617.

    Google Scholar 

  • Trevino, L. K., & Nelson, K. A. (2011). Managing business ethics: Straight talk about how to do it right (5th ed.). Hoboken: John Wiley & Sons.

    Google Scholar 

  • Trevino, L. K., Butterfield, K. D., & McCabe, D. L. (1998). The ethical context in organizations: influences on employee attitudes and behaviors. Business Ethics Quarterly, 8(3), 447–476.

    Article  Google Scholar 

  • Tushman, M. L., & Nadler, D. A. (1978). Information processing as an integrating concept in organizational design. Academy of Management Review, 3, 613–624.

    Google Scholar 

  • Voss, C. A. (1995). Alternative paradigms for manufacturing strategy. International Journal of Operations & Production Management, 15, 5–16.

    Article  Google Scholar 

  • Voss, C. A. (2005). Paradigms of manufacturing strategy re-visited. International Journal of Operations & Production Management, 25, 1223–1227.

    Article  Google Scholar 

  • Wotruba, T. R., Chonko, L. B., & Loe, T. W. (2001). The impact of ethics code familiarity on manager behavior. Journal of Business Ethics, 33(1), 59–69.

    Article  Google Scholar 

Download references

Acknowledgments

The authors wish to thank Lynn Godkin (Lamar University) and Duane Helleloid (University of North Dakota) for their helpful comments on this paper.

Author information

Authors and Affiliations

  1. Department of Management, University of North Dakota, 293 Centennial Drive, Mailstop 8377, Grand Forks, ND, 58202-8377, USA

    Sean Valentine & David Hollingworth

Authors
  1. Sean Valentine
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. David Hollingworth
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Sean Valentine.

Additional information

This research was supported by the College of Business and Public Administration and the Office of the Vice President for Research at the University of North Dakota.

Appendix

Appendix

Table 3 Variable scales
Full size table

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Valentine, S., Hollingworth, D. Communication of Organizational Strategy and Coordinated Decision Making as Catalysts for Enhanced Perceptions of Corporate Ethical Values in a Financial Services Company. Employ Respons Rights J 27, 213–229 (2015). https://doi.org/10.1007/s10672-014-9253-2

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10672-014-9253-2

Keywords

Search

Navigation