An ABC-analysis of EthicalOrganizational Behavior

André H. J. NijhofMarius M. Rietdijk

ABSTRACT. The Antecedent-Behavior-Con-sequence (ABC)-analysis is a tool for analyzingbehavior and sterns from the field of psychologywhere it is used as a tool for the understanding ofbehavior in general and organizational behavior inparticular. In this paper the ABC-analysis is imple-mented as a tool to understand why people behaveethically in organizations, through the identificationofkey environmental factors that cause such behavior.This analysis can be the first step to recognizing thecomplexity of circumstances determining ethicalbehavior, as weU as trigger for changing that behavior.This will be elaborated in the implementation processof an ethica! code. The working of the ABC-analysiswill be illustrated with an example derived from fieldresearch concerning the reorganization of a depart-ment of a chemical company.

Introduetion

More and more companies are now taking anactive interest in the encouragement of ethical

André NijhoJ is a research assistant at the University oJTwente, Faculty oJ Management and Technology,Enschede, The Netherlands. His major area oJ researchis ethical decision making with regard to conflictingresponsibilities. NijhoJ has published articles in man-agement, business ethics and HRM journals.

Marius Rietdijk is a research proJessor at the Centre JorOrganizational Learning and Change, NijenrodeUniversity, in Breukelen, The Netherlands. His area oJinterest is the application oJ behavioral analysis todifferent kinds qf organizational issues: e.g. the use oJreward systems and the stimulation oJ organizational,departmental and individu al change. Rietdijk haspublished articles on management, psychology and HRMin various academie and proJessional journals.

behavior and discouragement of unethicalbehavior among their employees as has been weIldocumented in this journalover the years. Howshould managers of companies encourage, forexample, personal honesty, equal employmentopportunities, employee rights and the confi-dentiality of company records while discouragingsexual harassment, the appropriation of otherpeople's goods and ideas and unauthorizedpayments to foreign officials (see Jennings, 1996)?The mainstream literature on business ethics hasexplored the moral norms and values of managersand business students (see Harris and Sutton,1995). Less attention has been paid to the devel-opment of tools to assist the promotion of ethicalbehavior, especially in dilemma-situations.

In this paper, we will describe such a tooI, the"Antecedents-Behavior-Consequences (ABC)-analysis", derived from a branch of psychologyknown as behavioral analysis (Grant and Evans,1994). ABC-analysis may contribute to a betterunderstanding of why people behave ethically, byanalyzing the circumstances in which suchbehavior occurs. It can be used for diagnostic asweIl as interventional purposes.

When it is used as a diagnosing tooI, some keycauses ofbehavior are specified. A distinction hasto be made here between antecedents and con-sequences. As the identification of specific causesof behavior paves the way for changing thesecauses, so th at the behavior will change, theABC-analysis becomes a method for preparinginterventions for encouraging ethical and dis-couraging unethical organizational behavior.

The determination of what an individu alshould or should not do within an organization,is not easy. In fact, organizational functioning isdetermined by many factors that are unique to a

Journal oJ Business Ethics 20: 39-50, 1999.© 1999 Kluwer Academie Publishers. Printed in the Netherlands.

40 André H. J. Nijhof and Marius M. Rietdijk

particular situation, thereby requiring the indi-vidual analysis of each situation in which anethical issue is at stake according to "thoseinvolved". The ABC-analysis is intended to do justthat because it concentrates on the conneetion betweencontext factors and behavior. Before explaining theABC-analysis, we will describe some problems indealing with unethical behavior as well as someother tools for the analysis of unethical behavior,especially in dilemma situations.

Dealing with moral dilemmas

Complexity of moral dilemmas

When decision makers want or have to strivetowards morally responsible decisions and actions,they are confronted with many obstacles in theirpath. The first and most important obstacle is theextensive varieties in the acknowledge of moralnorms and values among the different personsinvolved. Throughout the ages normative foun-dations for judgments about right and wrongwere based on many theories (with deontolog-ical, teleological, care and value orientations),which sometimes contradicted each other. All ofthem are still of some importance. Therefore, itis of little wonder that the current moralities ofpeople differ in many ways (see Maclntyre,1981). Due to the fact that judgment about thefairness of a decision is based on the underlyingnorms and values, a potential problem fordecision makers arises. Especially when there areseveral people who have to decide together orwhen there are also other people in addition tothe decision makers who make a judgment aboutthe decision and action.

However, even when the people involved allshare the same moral norms and values, it canbe very difficult to determine what is just andresponsible in a particular situation. Moraldilemmas are often not about making a choicebetween right and wrong, but between right andright or wrong and wrong. For example when aplant manager has to deal with big financiallosses, it is possible he will have to choosebetween laying off several loyal employees,reducing the wage of all employees or forcing

customers to buy his goods at a price that is toohigh. AU of these options can be perceived asunfair, but the manager still has to take adecision. The best way to deal with such adilemma is to reconcile all the different values (inthis case "making a profit" , "not firing loyalemployees", "not reducing wages" and "riot

manipulating customers"), but it stands to reasonthat this is easier said then done.

Dealing with moral dilemmas is a field ofethics referred to as applied ethics. In this field,the focus is on concrete decisions or actions andthen, as is mentioned by many authors, specificcircumstances play an important role in thejudgment-process (compare Nussbaum, 1986;Sen, 1992; Hekman, 1995). What is evaluatedas just and fair in one situation can be assessedas unjust in another. For example a cutback ofsomeone's income is not likely to be perceivedas fair when there are no specific causes, whenit was never talked through and when com-parabie others receive a raise in income.However, in a situation where an individual hasworked without much dedication and this wasdiscussed with him, a proportional decrease inincome will be perceived as fair by almost every-body. Hence the background leading to thedilemma situation and the options open to thedecision makers (determined by context factorslike the law, available resources, power, officialguidelines for decision making, etc.) must beconsidered in the judgment process.

Another obstacle to striving towards respon-sible action can be found in the limited infor-mation available to decision makers. March andSimon (1958) emphasize this point explicitly intheir theory of bounded rationality. Informationabout the consequences of a decision, about thechance on these consequences and about thecontextfactors, is of utmost importance injudging whether a decision is right or wrong(compare Nash, 1981).

Without pretending to give a completeoverview, decision makers who strive towards fairdecision making and actions are confronted withthe following chaUenges:

• Agreement on the underlying moral normsand values

An ABC-analysis of Ethica! Organizational Behavier

• Reconciliation of different values andnorms

• Consideration of the specific circumstancesof the situation

• Deciding on the basis of vague or incom-plete information

Tools for the analysis of moral dilemmas

Developing moral norms and values

In the literature on business ethics, several toolscan be found that can help to deal with some ofthese challenges. Discussion sessions based on thetheory of Kohlberg (1984) can help developmoral awareness of individuals. Empiricalresearch shows that this approach to moraldevelopment leads to a lasting change towardspost-conventional norms. Potentially, this resultsin more agreement on the underlying moralnorms and values. Also, this formulation andcommunication of an ethical code within anorganization can result in more agreement onimportant norms and values. But as is shownabove, there are still other problems to tackle ifone wants to come to justified acting.

Stakeholder analysis

A tooi that focuses on the different alternativesfor and consequences of a decision is theStakeholder-analysis (De George, 1993). In aStakeholder-analysis several questions have to betaken into account which give insight into thedilemma situation and possible solutions:

• Who is involved in the dilemma situation(in order to determine the relevant stake-holders)?

• Which interests do these distinguishedstakeholders have?

• What are the real moral issues involved inthis dilemma situation?

• Which different alternatives are possible andwhat are their consequences?

• Which arguments can be used to chooseeither one of the different alternatives?

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Analyzing a dilemma situation with aStakeholder-approach can provide valuableinsights. However, this approach also has certaindisadvantages. It concentrates on the conse-quences of behavior and is therefore based on ateleological approach to business ethics.Deontological arguments, which refer to theintentions of behavior, only receive minimalattention. Furthermore, a Stakeholder-analysisdoes not explain why certain behavior or certaindilemma situations occurred. An ABC-analysiscould, in this case, contribute to a further under-standing of ethical dilemma situations.

The ABC-analysis should not be used in placeof moral development sessions à la Kohlberg,ethical codes or Stakeholder-analysis but ratherin conjunction with them. Kohlberg and, tosome extend, also the Stakeholder approachassume that ethical behavior is determined byintrinsic motivation. The ABC-analysis is basedon the assumption that behavior is motivated byexternal factors. We will illustrated this in casesof smoking, the implementation of an ethicalcode and in the case study of the restructuringof a manufacturing department. First however,we will elucidate the background and structureof an ABC-analysis.

The ABC-analysis

The ABC-analysis is used by behavioral psy-chologists (Daniel, 1989, 1994; Komaki, 1986)and management scientists (Davis and Luthans,1979) as a tooi to understand and manage orga-nizational behavior. Here the ABC-analysis isapplied to ethical organizational behavior.

The ABC-analysis is derived from the theo-retical field that was established by the famousRussian scientist Iwan Pavlov (1927) and the (in)famous American psych 010gist B. F. Skinner (a.o.1938, 1966), called behavioral analysis. Behavioralanalysis is defined as a scientific method designed todiscover the [unctional relation between behavier andthe variables that control it (Sulzer-Azaroff andMayer, 1991, p. 3).

In behavior analysis those variables controllingbehavior are said to be found in the environmentof the behavior. In particular, contingencies of

42 André H. J. Nijhof and Marius M. Rietdijk

reinforcement could have a major impact onbehavior. The environment has a complex effecton behavior. Many stimuli effect it and theevolutionary and learning background of indi-viduals make all those stimuli have differenteffects.

The ABC-model has been validated exten-sively in fundamental and applied research inlearning (for example Cantania, 1992). A possibleexplanation of behavior is: "He behaves irre-sponsibly because his values and norms are atfault". Hence, the assumed norms and values arenot only deduced from the behavior but are alsosaid to cause the behavior. The problem here isthat environmental causes (such as reinforcementof the irresponsible behavior by either the partneror colleagues) are disregarded. In an ABC-analysis these specific environmental causes arehighlighted.

The importance of both underlying values andenvironmental causes for understanding behaviorcan also be found in ethical decision makingmodels. For example, Rest (1985) makes a dis-tinction between:

1. Recognition of a moral issue (moral aware-ness);

2. Evaluation of the different arguments in amoral issue (moral judgment);

3. Prioritization of moral values (moral intent);4. Perseverance to act in congruence with the

intention (moral behavior).

These four stages are all influenced by internalnorms and values of a person, as well as byexternal factors (see Trevino, 1986). As we haveseen in the paragraph on the complexity of moraldilemmas, awareness of the context is veryimportant in order to make an ho nest judgmentabout a dilemma situation and to the progressfrom an intention to actual behavior. This can bedemonstrated by focusing on the step from moralint ent to moral behavior. It is said that tenpercent of all people will always try to achievethe morally good, ten percent will have noobjection to acting immorally and the remainderwill act according to specific circumstances.

In this respect it is important to indicate at thedifferent contextual aspects. Wyld and Jones(1997) mention the influence of ethical work

climates on ethical decision making, in partic-ular, the influence of the modeling function ofother persons who one admires, corporate policyand ethical codes. In addition to these influenceswhich refer to the "soft" or social dynamic sideof the organizational context, the "hard" orinstrumental technical side of the organizationalcontext is also important (Fisscher, 1994). Incontrast to the organizational sciences, thisinstrumental technical side has been largelyignored in the field of business ethics. However,the influence of for example the reward systems,distribution of tasks, formal responsibilities andpower, together with the openness of the infor-mation system can be of value in dealing withethical dilemmas and diagnosing ethical behavior.The ABC-analysis provides the opportunity toconsider both aspects of the context. Let usconsider this tool in more detail.

ABC stands for Antecedents, Behavior andConsequences. An antecedent prompts a behaviorwhich is followed by a consequence. Behaviortherefore is a function of antecedents that preeedeit and consequences that follow it. We need tounderstand the way these elements interact inorder to analyze ethical problems, take correctiveactions, and design work environments and man-agement systems in which ethical behavior willoccur. Behavior is here defined as any action thatis seen to be performed by an individual.

An antecedent is a person, place, thing, or eventpreceding a behavior that encourages employeesto behave in a certain way. In business we designthe work place to prompt correct or desirabieresponses and performance. Some of the morecommon antecedents used in business are thingssuch as goals, objectives, priorities, accountabil-ities, job descriptions, policies, procedures,slogans, standards, meetings and rules.

All resources provided to help us to do our jobare categorized as antecedents. Tools, raw mate-rials and conditions of the work place such astemperature, lighting and housekeeping affect theway we work. All of these "set the stage" for acertain work behavior or performance. However,they do not guarantee that it will occur. Thereason why antecedents influence behavior at allis that they are associated with certain conse-quences which occurred in the past.

An ABC-analysis of Ethical Organizational Behavior

The most influential antecedents are thosealways paired with a particular consequence. Forexample, a hot stove always burns or salt peanutsin a bar are very likely to make the clients drinkmore. The less consistent the pairing, the lesseffective the antecedent will be in promptingbehavior. The TV weather forecast may not causeyou to carry an umbreUa because your experi-ence of that particular forecaster is such that youwill take a chance that it won't rain.

Antecedents that have no consequences at alltend to have a short-term effect. Job descriptionsare notorious for their short-lived effect on howpeople actuaUy perform on the job. Manyemployees learn very quickly that what the jobdescription says and what achieves the desiredconsequences are two different things (Daniels,1989). Scott Morgan (1994) calls this "theunwritten rules of the game", whereby heemphasizes the role of informal, but rewardedrules above and beyond the official rules of anorganization. In the examples of this artiele wewill consider both formal and the informalaspects of the organizational context.

Consequences are the reason for the effective-ness of antecedents. Consequences are eventsfoUowing behavior. Consequences are an effec-tive management tool to guide and enhanceemployee performance and improve morale. Forstimulating ethical behavior, we can try to createconsequences that decrease unethical behavior orconsequences that increase ethical behavior.

For example, Nestlé's experience with instantbaby food wiU either cause the firm to be verycautious or may even prevent them gettinginvolved in a similar affair. Also other compa-nies have seen the problems which can originatefrom business perceived as sociaUy irresponsibleby many persons in society. This might also bethe main reason why Carlsberg and Heineken,two beer companies working on factory plantsin cooperation with the regime of Burma,hastily withdrew recently after several groupshad expressed their disapproval of these opera-tions.

In order to manage ethical behavior it isimportant to understand the causes of the currentlevel of ethical behavior. In looking for causes,four things are often neglected:

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1. Managers are often incapable of puttingthemselves in the position of other personsinvolved

2. They concentrate too much on finding thecause of unethical behavior, without con-sidering other causes (almost always thereare many causes)

3. They analyze only the antecedent of thecurrent ethical conduct, but not the con-sequences of that behavior for theemployee. Sometimes there is no circum-stantial reason for employees to behave eth-icaUy, other then their own sense ofresponsibility.

4. They try a solution that worked elsewhere,while ignoring all the limitations of thecurrent situation.

An ABC-analysis may avoid these pitfaUs by theanalysis, from the perspective of the employee, ofas many antecedents as possible as well as theconsequences of the behavior. Consequences canbe negative, neutral or positive for the performerof certain behavior. When consequences arenegative we can expect that the behaviorpreceding the consequence will decrease infrequency in the future. When consequences areneutral there is no change and when conse-quences are positive, it is likely that the behaviorwill be repeated and increased in the future.Once we know why an individual behavedunethicaUy, we can change some antecedents andconsequences of that behavior in order to changethe behavior itself. The function of an ABC-analysis changes then from diagnosing to a tooIfor intervention.

Example 1: Smoking in the workplace

In an ABC-analysis the antecedents, behavior andconsequences of ethical behavior are described,for example of smoking in the workplace.Smoking is considered increasingly as unethicalbecause of the health-risks for coUeagues and alsoother reasons that are delineated in the foUowingABC-analysis:

44 André H. J. Nijhof and Marius M. Rietdijk

Offering of a cigarette by apeer

Coffee break

Relieving of physical defieiency/feeling weil

Health risk for oneself

Health risk for others

Seeing others smoke Smoking in theworkulace

Some coUeagues don 't like it

Not wanting to be an out-sider in a smoking group

Feeling the cigarettes in yourocket

Some people like you more

It helps to decrease tension

It kee S our senses satistied

Figure 1. ABC-analysis for smoking in the workplace.

In the first column some antecedents ofsmoking in the workplace are delineated. Themost important antecedent for smoking probablyis a history of smoking so that there is a physicalneed for nicotine. Smokers are more inclined tosmoke when they are offered a cigarette by apeer, when they see others smoke, when thereis group pressure to smoke and when they feelthe packet of cigarettes in their pocket. Also acoffee-break is often a moment of relaxation andan invitation for smoking.

In the right hand column some consequencesand values of the consequences for smoking inthe workplace are enumerated. After smoking,smokers feel relieved of physical deficiency, feelless tension and their senses have been kept busy.These consequences are valued as positive by themajority of smokers. Some negative conse-

Instruction meetingNo smoking in tbe

workplace

Rewards (money, goeds,compliments)

Non-smoking signs

quences for the smoker are the health risk tohim- or herself and to others (a sense of guilt?)and complaints of others.

A way to decrease smoking in the workplacecould be a reduction in current antecedents (forexample, not taking a packet of cigarettes to theworkplace, so that it can't be felt in the pocketand one can only smoke by asking others for acigarette). A second way of decreasing smokingin the workplace could be the addition ofantecedents, for example by the posting up ofnon-smoking signs or by an instructional meetingwith the management in which it is made clearthat nonsmoking is much appreciated. In the areaof consequences, there could be some additionof rewards for nonsmoking in the form of money,goods and/ or compliments.

Figure 2. Some antecedents and consequences that could promote nonsmoking in the workplace and could beadded to the factors mentioned in Figure 1.

An ABC-analysis af Ethical Organizatianal Behavior

Irnplernentation of an ethica! code

At the beginning of this artiele we mentionedthe significanee of formulating and communi-cating an ethical code to achieve agreement inan organization on moral norms an values. Theethical guidelines of such a code have to be clearand specific in order to function as pregnantantecedents. This is not however a guarantee forethical decision making in a company. Ethicalguidelines work only when they are linked withmeaningful consequences - i.e. if somethinghappens to an individu al as a direct result offollowing or not following the rules. Let us nowconsider this in more detail.

Next to ethical guidelines, other aspects ofcorporate culture are also important antecedentsfor (un)ethical behavior as Chen et al. (1997)have articulated recently in this journal. Jackall(1988) articulates the importance of normal rul esby which managers are assessed and the example-function of both colleagues and managers (seealso Jones and Kavanagh, 1996). Victor andCullen (1988) stress also the importance ofthe organizational elimate and hierarchicalproperties.

The instrurnental technical aspects of anorganization can either stimulate or imp edeethical decision making. French (1984) indicatesthe importance of decision making procedures.It is not the organization which makes decisionsbut the people within that organization, although"the organization" is held responsible for thesedecisions. To face up to this task it is importantthat the distribution of tasks, power and respon-sibilities within an organization and the accom-panying decision guidelines are appropriate forthe translation from individual to organizationallevel. Other scholars stress also the importance ofcontrol and monitoring systems within acompany (see Velasquez, 1988). The aphorism"Tell me how you measure me and I will actaccordingly" illustrates this.

Reactions to perceived injustice

To get a complete overview of the factorsinfluencing decision making and the behavior ofpeople, it is also important to look beyond the

45

organizational context. The reactions of peopleoutside the organization are also important indeciding what to do. There are many examplesof societal issues when action groups or cus-tomers called a company to account and conse-quently the company tried to reverse a decisionlater. This, of course, can also lead to decisionmakers trying to anticipate in order to preventbeing called into account. This kind of reactionto perceived injustice does not only occur outsidean organization. Employees react to perceivedjustice and injustice as well. Empirical researchhas demonstrated that perceived procedural anddistributive justice have significant effects onorganizational citizenship behavior (Morgan,1993) and the willingness to go along with orga-nizational theft (Greenberg, 1993).

Here, an ABC-analysis can help to give insightsto the different factors which are important tobring the decision making within an organiza-tion in congruence with the ethical code ofcon-duct. Therefore, we should look at ethicaldecision making as the central "Behavior" andexplore all factors in the meaning of"Antecedents" and "Consequences". Based onthe literature mentioned before and logicalreasoning, the outcome of such an analysis ispresented in Figure 3.

The overview of antecedents and conse-quences in Figure 3 points at several managementmethods necessary to the stimulation of ethicalbehavior. Of course, the communication of anethical code is a very important method forstimulating ethical decision making, as is anevaluation of the information, monitoring andreward-system. Furthermore, training sessions canbe developed to increase the competence of indi-viduals to reconcile different responsibilities. Theanalysis suggests that a reflection on the socialdynamic mechanisms of possible reactions to per-ceived injustice might indicate ways of recon-ciling these responsibilities. By the term "socialdynamic mechanisms" we refer to the interac-tions, in the social dynamic side of a company,between the effects of a certain decision oraction. These interactions can lead to win-winsituations where all the responsibilities can bereconciled.

46 André H. J. Nijhof and Marius M. Rietdijk

Antecedents :. I' • I

":''''I Absence or présence ofsupport of topmanagement

"""Ethical code

Congruence betweenorganizational norms andpersonal norms

Behavior of colleagues andmanagement

Tradition and habits in thebranch (competitors behavior)

Information available to decisionmakers

Ability to reconcile the differentvalues in the dilemma situation

History of the dilemma situation

Official monitoring and controlsystem

Formal reward system

Guidelines for decision making

Expected support ofmanagement

Ethical decisionmaking

No moral stress for thedecision makers

Being called into accountby ether people involved(in a positive or negativeway)

Reactions on perceptionof justice by the otherpersons involved(organizational citizenshipbehavior)

Consequences for yourown development withinthe company (promotion,demotion, transfer toanother department)

Aetual rewarding(including socialreinforcers )

Figure 3. ABC-analysis for implementing an ethical code.

The list in Figure 3 is still at a high level ofabstraction. We will illustrate the working of anABC-analysis on a more concrete level, by meansof a case study where managers had to take adecision regarding the implementation of anorganizational change process.

Example 111:Restructuring amanufacturing department

The ABC-analysis was applied to shed light onan ethical dilemma which was investigated

through field-research. From August 1995 untilFebruary 1996 a change process was explored bya Dutch organization in the chemical industry.During this change process the management ofthe company had to take some difficult decisions,because production costs had to be reduced, thequality of the production process had to beimproved and this could not be do ne withoutsevere consequences for employees.

One particular dilemma occurred when thepackaging department was re-examined. Twentypeople worked in this department in a five-shiftstructure (the process operated 24 hours a day

An ABC-analysis of Ethical Organizational Behavier

and 7 days a week). The packaging-line in thisdepartment originated from the early seventiesand had begun to malfunctioning. This led toproblems in the planning of the packaging andproduction process, to many additional costs dueto mechanics being called at inconvenient hoursand to irritation among the employees.Therefore, management started to look into newtechnologies. After profound research, a plan wasdeveloped whereby a whole new packaging-linewas implemented, including a large store whichcould function as a buffer for two days betweenthe production and packaging of the product.The total amount of money needed for thischange process was about five million guilders(three million dollars).

Although this plan had positive effects on thefunctioning of the packaging department, it alsohad some severe consequences for the employeesinvolved. As a store is now included in the newpackaging-line, the need no longer exists for afive-shifi structure. The employees could returnto a ene-term structure with normal workinghours from eight a.m. till half past four p.m.Some employees perceived these new workinghours as an advantage. However, the new struc-ture also took away the need for the five-shiftbonus which was 27.5 percent of employee'sentire income. So, while bringing a more effec-tive work situation, normal working hours anda relief of stress connected with the old system,the new structure also brought a huge decreasein income for the employees involved. An othersevere consequence concerned the restrietion inthe number of employees needed in the pack-aging department. Originally, twenty peopleworked in the department, but due to the newpackaging-line only nine persons were needed.

In Figure 4 some important aspects connectedwith the decision to change the packaging-lineare cited. In the decision making processmanagers have to deal with responsibilitiestowards several stakeholders, like employees,customers, suppliers, stockholders and society(Badaracco, 1992). Also in this illustration, it isnot possible to find a solution which accornmo-dates all the responsibilities. One has to choosebetween the conflicting responsibilities. However,in order to make a good decision and weigh all

47

the aspects involved, an instrument such as theABC-analysis can be helpful. The chance ofsome aspects being forgotten or overlooked ismuch smaller. In addition, because the aspectshave to be noted separately as antecedents orconsequences, it is easier to consider their inter-relation and complexity.

The outcome of the decision making processwas that the managers reached a kind of com-promise. The changes in technology were imple-mented but the consequences for the employeesare largely alleviated. No one had to be fired,because other solutions were found. For example,some elderly employees retired early, oneemployee transferred to another department andfor the others an outplacement procedure wasinitiated to find an acceptable job elsewhereeither in- or outside the company. The reduc-tion in income was not implemented immedi-ately but gradually over two years, although thereturn to normal hours was implemented imme-diately. For elderly workers, another concessionwas made. Employees of 55 years and older hadthe right to keep approximately 10 percent ofthe bonus. The reason for this being th at it wasconsidered unfair to someone having workedalmost all his life in a five-shift structure if havehis retirement money were then based on themuch lower income of a one-shift structure (inDutch law one's retirement income is based onthe income one earns in the last year beforeretirement). With a compromise like this allstakeholders were satisfied to some extend,although everyone could also complain aboutcertain aspects of the decision.

In the restructuring of the packaging depart-ment, the managers had to make some drasticdecisions concerning both regarding the processof reorganization itself as weIl as its consequences.If an organization chooses to deal with suchorganizational changes in a morally responsibleway, this can have several positive effects. Thefairness (in both procedural and distributiveterms) of a reorganization process can make iteasier for the affected people to accept thechange process, can lead to less moral stress andcan also have positive effects on the performanceof the survivors of the reorganization (seeBrockner, 1992). However, as we have seen

48 André H. J. Nijhof and Marius M. Rietdijk

Many malfunctioningsof the packaging-line

Costs of the packaging-line are (too) high

Reputation of thecompany as a social andcooperative organization

Organizational value notto dismiss anyonebecause oforganizational changes

Every person deserves tohe respected and toknow the truth

Assessing the short termresults of managers

Decision toimplement a newpackaging-line

Breakdowns of the packaging-line have decreased greatly;hence there is Iess rejectedproduct and customers can beserved in time

Long-range perspectives of thecompany are improved

for theMore profitorganization

Costs are reduced

Reduction in income foremployees of 27,5 percent

Renrement money is also basedon the lower, last earnedincome

11 out of 20 employees are nolonger needed in thedepartment (possible dismissalof several em 10 ees

Figure 4. ABC-analysis for a change process in a packaging department.

before, in stnvmg for responsible actions thecontext of a decision making process is impor-tant. In the case illustration, the headquarters ofthe company assessed the business unit managerson short term results, so it was very difficult forthem to act in a morally responsible way that mayhave positive results for the organization only inthe long run. Here, an ABC-analysis can helpto evaluate which antecedents and consequencesstimulate or prevent morally responsible behavior.Then the use of the ABC-analysis shifts againfrom diagnosis to intervention. For the case ofthe packaging department, such an ABC-analysisis shown in Figure 5.

Couclusion

:

In this article, we described the general guide-lines of an ABC-analysis and illustrated the useof an ABC-analysis with various examples. In ouropinion, the ABC-analysis can function as avaluable instrument to analyze ethical dilemmas.Compared with a Stakeholder-analysis, theemphasis on antecedents and situational circum-stances are amenities. A relativisation of an ABC-analysis is also in place because it does notautomatically include all parties involved (stake-holders) and it does not concentrate in toa muchdetail on intrinsic motivation th at mayalsoinfluence the behavior of people.

This illustration of the ABC-analysis alsodemonstrates th at it can contribute to the

An ABC-analysis of Ethical Organizational Behavior 49

Organizational policy notto fire anyone as a conse-quence of organizationalchanges

Improved motivation ofemployees due to acting in amorally responsible way

Having a company widesocial plan for dealing withreorganizations

Morallyresponsible

decision making

Having a good feeling aboutacting in congruence withyour moral values

Giving enough authority tomanagers

Assessing the long termresults of managers

Figure 5. An ABC-analysis for stimulating morally responsible management.

<,

solution of a long existing problem in businessethics. In the philosophy of ethics, there hasexisted a conflict in orientation between theintentional-approach (deontological) and theconsequential-approach (teleological) for cen-turies. In an ABC-analysis both viewpoints areintegrated because both intentions (as cognitiveantecedents) and consequences are taken intoaccount.

Finally, an ABC-analysis elucidates the reasonswhy certain behavior occurs or wi11 occur.Therefore, it gives an overview of the argumentswhich can explain (in retrospective) or predict(in prospective) certain actions. This might beuseful when managers or other people try todiagnose behavior and try as aresult to stimu-late certain desired (ethical) behavior. In thisartiele we have tried to give some guidelines forthe implementation process of an ethical code,although we did not aspire giving a completeoverview. A further practical investigation wouldbe required to evaluate the empirical validity ofthe ABC-instrument in dealing with ethicaldilemma situations.'

Note

1 The authors want to acknowledge the helpfulcomments of I. N. Rietdijk, N. N. Stephenson andtwo anonymous reviewers of an earlier version of thisarticle.

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University af Twente,Faculty af Engineering and Management,

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