Achieving Top Performance While Building Collegiality in Sales: It All Starts with Ethics

Abstract

While previous literature provides evidence of the positive relationship between ethical climate and job satisfaction, the possible mechanisms of this relationship are still underexplored. This study aims to enhance scholars’ and practitioners’ understanding of the ethical climate–job satisfaction relationship by identifying and testing two of the possible mechanisms. More specifically, this study fills an existing research gap by examining social and interpersonal mechanisms, referred to in this study as workplace isolation of colleagues and salesperson’s teamwork, of the ethical climate–job satisfaction relationship. This is vital for the selling profession because job satisfaction is known to drive higher levels of salespeople’s performance. The arguments for such mechanisms are built on the foundations of social/psychological contract theory and ethical climate literature. Empirical testing using a large sample of salespeople shows higher levels of ethical climate to decrease workplace isolation and increase teamwork. Findings support hypothesized model where ethical climate positively relates to job satisfaction as partially mediated by workplace isolation and teamwork. Ethical climate is negatively related to workplace isolation and positively to teamwork. Further, findings indicate negative effect of workplace isolation on teamwork and sales performance. Job satisfaction is found to be key factor in driving performance of salespeople.

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Fig. 1

Notes

  1. 1.

    In hypotheses 3 and 4, two partially mediated relationships are hypothesized. Previous studies that tested direct and indirect effects of ethical climate on job satisfaction suggest that ethical climate–job satisfaction is not only mediated by workplace isolation and teamwork, but also by other variables. For example, indirect effects are through variables such as role ambiguity, role conflict (Jaramillo et al. 2006; Riggle 2007), and trust in supervisor (Mulki et al. 2006). In hypothesizing partially mediated relationships, we assume the mechanisms through which ethical climate affects job satisfaction are not limited to workplace isolation of colleagues and salesperson’s teamwork. Other possible variables, such as relational conflict, interpersonal deviance, and organizational citizenship behaviors, can mediate ethical climate–job satisfaction relationship.

  2. 2.

    The sales sample for the study was derived from a multilevel direct selling organization. In direct selling, salespeople act as independent agents and their compensation is commission based. Commissions are paid as a percentage of their own sales and a fraction of the sales from the individuals they recruited for the organization. New recruits are critical in maintaining performance growth objectives and the long-term viability of the firm. As such they constitute an important objective measure of performance.

  3. 3.

    Based on the feedback received from company’s executives and to better fit the context in which our study took place, a four-item scale to measure perceived ethical climate was used (Jaramillo et al. 2013) as mentioned before. In this scale, two items measure salesperson’s perception of the socialization process in which acceptable ethical behaviors are observed and learned from sales directors and other colleagues. Salespeople do learn about ethical behaviors and conduct from observing other employees and superiors within an organization (Brown, Treviño and Harrison 2005; Ingram et al. 2007). As stated by one of the respondents: “The company’s people can be good role models and therefore, help others to become better people.” The other two items measure salesperson’s perceptions that the company is following the golden rule or law of reciprocity, “Do to others what you want them to do to you,” to guide ethical behaviors. The golden rule is a universal moral principle (Burton and Goldsby 2005). Following the golden rule means acting ethically for majority of individuals (Gensler 2013). Several organizations, including the one we collaborated with to collect the data, explicitly rely on the golden rule as guide of ethical behaviors of their employees. Many organizations also include this rule in their code of ethics. In the selling profession, the golden rule is a conventional standard for ethical decision making by salespeople (Weeks et al. 2006). The vital role of the golden rule was emphasized by respondents when asked about their job and the characteristics of the company (briefly describe three characteristics of your job that you consider appealing). For example, some of the respondents’ statements are: “The golden rule philosophy allows me to do what's right for the person I am working with,” “Being honest and living by the Golden Rule,” “Operating my business using the Golden Rule,” and “The ethics and the ‘Golden Rule’ guidelines established.”

  4. 4.

    The model was also tested with the actual numbers (averages) of both performance measures, in which similar findings were found.

  5. 5.

    Post hoc analysis for double mediation using process macro (model 6) was also conducted (Hayes 2009). The results found provide additional support in favor of the multiple mediation effects (H2 and H3) of workplace isolation of colleagues and salesperson’s teamwork on ethical climate–job satisfaction relationship. Also, Sobel tests conducted show that the mediating effects tested are significant. Model 6 in process macro can test double mediation models, but cannot incorporate the full model (including both performance measures) of this study. The process technique was used only as additional method to provide further statistical support to the findings (H2 and H3).

Abbreviations

SCT:

Social contract theory

PCT:

Psychological contract theory

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Correspondence to Omar S. Itani.

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Appendix

Appendix

Latent variables and items description Items loadings
Ethical climate—Golden Rule (CR = .78; Cronbach’s α = .73; AVE = .65)  
The Golden Rule gives guidance about acceptable ethical behaviors .93
The founder of the business follows the Golden Rule which provides cues about acceptable ethical behaviors .66
Socialization (CR = .70; Cronbach’s α = .63; AVE = .55)  
My sales director provides guidance about acceptable ethical behaviors .89
I learn about acceptable ethical behaviors from other salespeople .55
Teamwork (CR = .80; Cronbach’s α = .78; AVE = .58)  
I operate as a team player when performing in groups .63
I always fulfill my obligations to other salespeople .77
I am willing to do my part for the good of any team that I am a part of .87
I prefer to conduct my out-of-office (company name) activities accompanied by other salespeople  
Workplace isolation of colleagues (CR = .81; Cronbach’s α = .78; AVE = .52)  
I have other salespeople available whom I talk to about day-to-day problems (R) .68
I have other salespeople available whom I can depend on when I have a problem (R) .70
I have close friends within the (company name) sales force (R) .52
I have enough people available within the (company name) sales force with whom I can talk about my (company name) business (R) .92
My sales director is available when I need to talk about day-to-day problems (R)  
Job satisfaction (CR = .91; Cronbach’s α = .91; AVE = .78)  
My (company name) business is satisfying .82
I am doing something worthwhile as a salesperson .91
My (company name) business gives me a sense of accomplishment .91
Sales performance (CR = .96; Cronbach’s α = .97; AVE = .84)  
October–March .87
April–September .94
October–March .92
April–September .94
New recruits (CR = .90; Cronbach’s α = .78; AVE = .69)  
October–March .79
April–September .82
October–March .85
April–September .86
  1. Items in italics were deleted. All items loadings are significant at p < .01. Reversed coded = (R)

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Itani, O.S., Jaramillo, F. & Chonko, L. Achieving Top Performance While Building Collegiality in Sales: It All Starts with Ethics. J Bus Ethics 156, 417–438 (2019). https://doi.org/10.1007/s10551-017-3598-z

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Keywords

  • Ethical climate
  • Job satisfaction
  • Performance
  • Salespeople
  • Social/psychological contract theory
  • Teamwork
  • Workplace isolation