The Importance of Ethics in Business
It’s unlikely that anyone really sets out in hopes of doing business with a company that’s unethical.
The age-old phrase, “you get what you pay for” couldn’t be more spot on, especially when something sounds too good to be true. While we all trust that the companies we purchase goods and services from are inherently ethical, do you ever take the time to do some research and find out for sure?
Ethics are essential if you want to build a reputable business with staying power; unfortunately, it seems like many business owners are more focused on instant gratification, using any means possible to make money. While you may find success in business faster participating in unethical and unsavory behavior, you must be prepared to weather the consequences you will inevitably encounter.
What are Business Ethics?
Just to refresh, business ethics are essentially the morals and standards that you use to run your company.
Basic ethics in business include being truthful and trustworthy—they’re the standards by which your customers will judge your company, and the measurements they’ll use to determine whether or not to give you repeat business or even do business with you in the first place. While there is a standard laid across the board, it is ultimately up to you to determine what business practices you consider ethical and implement them in your company culture.
The Importance of Business Ethics
There are many reasons to abide by ethical practices in all areas of your business. Some of them include:
As mentioned above, most customers will take the ethics by which you run your company into consideration when deciding to do business with you.
A company that establishes themselves as unethical will notice a decrease in their customer base, as people stop doing business with them, and turn to a company offering the same or similar service, but in an ethical way. Customers expect a return on their investment when they pay you for goods or services, and if you set a standard of unethical behavior, it’s likely they’ll lose confidence in your ability to deliver.
Just like customers, most employees don’t want to be associated with unethical business practices.
Whether they have a say in the policies of the company or not, most employees want to work at a place where they can feel morally sound and sleep at night knowing they’re being honest and truthful with their fellow man. When implementing unethical practices in your business, you can expect to have a high employee turnover rate, which in turn will cost you more money as you have to continually pay to hire and train new staff.
Dignity and Self-Respect
Can you look yourself in the mirror each day and feel good about what you see when you know you’re being dishonest with your customers or employees? Do you want to gain the reputation of being someone to watch out for in the business world? Or would you rather be slightly less successful, but respected and trusted?
How to Establish Your Company as Ethical
So now you know what not to do, what are some things you can do to make sure you’re running your business in an ethical way?
Becoming an entrepreneur is no easy task. It’s risky and scary, but it can be rewarding. In the beginning it may seem like a daunting task. You might have hundreds of questions and feel like you don’t know anything. So here are some frequently asked questions about being an entrepreneur that we’ve answered to help make your entrepreneurship a little easier.
How can I tell if I have what it takes?
There are definitely common qualities among all entrepreneurs. Most don’t get intimidated easily. If they experience a setback, they won’t stop, they will keep going. You should be able to enjoy competition, be a self-starter, be able to adapt to change and have the ability to assess risk when making business decisions. Take Tracy Rawle the CEO of Check City for example. He was able to assess risk when deciding to switch from a successful family business to his new career of being an entrepreneur. He made the big decision to move forward and knew with hard work and dedication to a solid mission, it would be worth it.
What are the biggest mistakes new business owners make?
This is a good question. There will always be little mistakes made but the biggest are these three:
How do you balance your long hours with the rest of your life?
When starting a business, you need to let go of perfectionism. Granted, you will spend most of your day working and you will have to put in long hours but you need to be able to unplug, relax and spend time with people you are close to. Tracy Rawle makes sure to always set aside time to be with his family. Even when he couldn’t spend time at home he took his sons to work with him to teach them about the business. Spending time with loved ones has extreme benefits. In addition, always spend at least one hour relaxing and refreshing your mind.
What causes a small business to fail?
There are so many factors that can cause a business to fail, but if you don’t have good experience and management capability, success could be hard to achieve. Undercapitalized businesses also don’t succeed very often. Remember that you are starting from scratch and you need to build supplier relations and financial security.
How do I turn my small business into a success?
To be successful you need to choose your business carefully and see if it’s something consumers would find interest in. Set goals and find support in a network of friends and family that will help out and give advice. Design your office so that it’s efficient, listen to customers and what they want, and don’t forget to stay flexible and responsive to your employees.